US: Drug Companies to Pay $1.25B to Settle

Opioid Suits with West Virginia

Communities in West Virginia say they would get $1.25 billion from the drug industry in a proposed settlement that would end most of the litigation stemming from the opioid crisis in the state.

The settlement would be the first of its kind, even as drug manufacturers, distribution companies and retailers are considering settling some 3,000 lawsuits nationally over what others,including the families of those who died of opioid addiction, believe was their role in fuelling an epidemic that has been linked to more than 430,000 deaths in the U.S. since 2000.

Paul Farrell, a West Virginia-based lawyer who is one of the leaders in the lawsuits nationwide, said governments in his state have agreed to the deal that was hammered out by 250 lawyers in a Charleston office building last week. Farrell said the companies would have to determine how much each would pay and officials in West Virginia still have to figure out how to divide the money among the state and local governments, hospitals and other entities. A panel of judges could be called in to settle the allocation formula if there are disagreements.

Lawyers’ fees would not come out of the $1.25 billion. Rather, they would be an additional amount set by the West Virginia Mass Litigation Panel, which is made up of state judges. How to handle Lawyers ' fees has been a factor in a dispute between states over whether to enter a nationwide opioid settlement with three major distributors and drug makers Johnson & Johnson and Teva.

The West Virginia plan would be the first statewide opioid settlement with companies from all parts of the drug industry. West Virginia has the country’s highest fatal opioid overdose rate.

Farrell said the companies would have until the start of a federal trial expected in coming months over claims from the city of Huntington and Cabell County against the major distributors. A judge is expected to set a date for it during a hearing Thursday.

Not included in the potential state deal would be state Attorney General Patrick Morrisey’s claims against drug makers. Morrisey would be able to continue those lawsuits or reach separate settlements – possibly as part of national deals. The West Virginia plan also does not apply to two key drug makers, Purdue Pharma and Mallinckrodt. Both are attempting to settle opioid lawsuits they face through bankruptcy court.

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