Johnson & Johnson Settles New York Opioid Case for $ 230 Million

Johnson & Johnson

has agreed to pay $ 230 million to New York State to settle an opioid lawsuit due to go on trial Tuesday as negotiations with the company and three drug distributors intensify to reach a decision $ 26 billion comparison of thousands of other lawsuits blaming the pharmaceutical industry for the opioid crisis.

Johnson & Johnson’s New York deal removes it from an upcoming trial in Long Island, but not from the rest of the cases it faces nationwide, including an ongoing trial in California. The New York settlement includes an additional $ 33 million in legal fees and expenses and calls on the drug maker to stop selling opioids nationwide, as Johnson & Johnson said it would.

The states have tried to use the opioid trials to reconstruct what they achieved with tobacco companies in the 1990s, when settlements totaling 206 billion US dollars flowed into the treasury. More than 3,000 counties, cities and other local governments have also filed lawsuits over the opioid crisis. complicated conversations that dragged on since the end of 2019 and which were slowed down by the Covid 19 pandemic.

Johnson & Johnson, along with the largest drug distributors in the country,

AmerisourceBergen Corp.


Cardinal health Inc.


McKesson Corp.

, in talks with attorneys general and plaintiffs attorneys for local governments to resolve the $ 26 billion cases.

The company said Saturday that there is continued progress on the statewide agreement and that it “remains committed to providing reassurance and critical assistance to communities in need”.

In the last few weeks the broader settlement discussions have picked up speed when the exams began in California and West Virginia, according to attorneys involved.

Company representatives, including drug maker Johnson & Johnson, are involved in opioid settlement talks.


Mark Kauzlarich / Bloomberg News

The New York Trial, which will be the first nationwide to be heard by a jury and the first to involve companies across the opioid supply chain, has made the negotiations more urgent. The testimony continues Monday in the California trial launched by multiple counties against four drug manufacturers and West Virginia trial against drug dealers.

A core team of attorneys general has held regular telephone settlement conferences and “conducted face-to-face negotiations in New York almost every day for the past few weeks,” according to a mid-June announcement in an opioid case in San Francisco.

The lawsuits and settlement meetings come after more than four years of litigation by states, cities, and counties for a portion of the cost of an opioid epidemic that has killed half a million people in the US since 1999.

The testimony will be resumed in the West Virginia Drug Dealer Trial.


Kenny Kemp / Charleston Gazette-Mail / Associated Press

Governments claim that the pharmaceutical industry has pushed the prescription and distribution of opioids beyond what is medically necessary, leading to widespread addiction that has led to higher levels of abuse of illicit opioids such as heroin and fentanyl. The companies have largely denied the claims, stating that they were selling or distributing a legal, government-regulated product that is required for pain management.

Although expensive, a comparison would give companies and their investors some assurance about their future opioid liability. McKesson said it had a charge of $ 8.1 billion; AmerisourceBergen and Cardinal each have $ 6.6 billion; and $ 5 billion would come from Johnson & Johnson. New York’s share will be deducted from this amount, the company said.

The $ 230 million to New York will be paid out over nine years, but more than half could come as early as February if all sued local governments approve the deal and if the governor signs a new state bill that creates a special fund to help fund opioid Use settlements to contain the crisis.

Addiction experts largely agree on the most effective way to help opioid addicts: drug treatment. But most inpatient rehab facilities in the US don’t offer this option. Jason Bellini from the WSJ reports on why the medication option is controversial and difficult to come by in many places. Image: Ryno Eksteen and Thomas Williams (video from November 16, 2017)

The New York trial was originally scheduled for March 2020 but has been postponed due to the pandemic. Attorney General Letitia James will file claims alongside Suffolk and Nassau counties. With J & J’s settlement, the defendants include three other opioid manufacturers, several drug dealers, and the pharmacy

Walgreens Boots Alliance Inc.,

which was only sued by the counties. Three other large pharmacies—

Walmart Inc.,


Aid Corp. and

CVS health Corp.

– were disconnected from the process during the jury selection, although the conditions for settlements were not disclosed.

In a statement, Ms. James said the state’s focus remains “getting money into opioid-ravaged communities as soon as possible.” Hunter Shkolnik, a district attorney, said that “judgment day is here” after several delays.

Walgreens said it only distributed opioids to its own pharmacies, not pain clinics, internet pharmacies, or “pill factories” which it says have fueled the crisis. AmerisourceBergen said the company has no control over the demand for drugs it sells and is following federally mandated quotas. The other companies declined to comment or did not respond to requests for comments.

The lawsuit, like the others on trial, alleges that the companies caused public harassment by flooding communities with opioids. The first phase of the New York process, which is expected to last four months, will alone determine whether the companies are liable. If a jury found this, a separate process would examine how much money they owe the state and counties.

The study differs from those that took place in Oklahoma, California and West Virginia in that it will involve actors from across the supply chain. That will make it harder for companies to blame others for the problem, said Elizabeth Burch, a law professor at the University of Georgia.

“What we’re seeing in the trials that are going on right now is it’s easy to point a finger at empty chairs,” she said.

the first opioid study, filed by the state of Oklahoma, resulted in a $ 465 million judgment against Johnson & Johnson, which the company is appealing. Another lawsuit in the case of two Ohio counties, ended in settlements shortly before the planned start in 2019.

Talks about a broad resolution of the opioid cases slowed down during the pandemic as procedures were delayed. Trial appointments often serve as a deadline for comparisons, as both sides can benefit from the security of a deal compared to the unpredictability, cost, and time involved in legal proceedings.

Once the structure of the deal is completed, there are still a few steps left until payday. State and local governments will have several months to register, according to the latest filing in the San Francisco case. Companies will also have an option to leave if not enough government agencies join the settlement, lawyers involved in the negotiations said.

Around $ 2 billion of the settlement is set to be used for legal fees, the lawyers said.

Write to Sara Randazzo at [email protected]

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