Tentative $161.5M settlement reached in West Virginia opioid trial

Attorneys for the state of West Virginia and two remaining pharmaceutical manufacturers have reached a tentative $161.5 million settlement just as closing arguments were set to begin in a seven-week trial over the opioid epidemic, Attorney General Patrick Morrisey said Wednesday.

Morrisey announced the development in court in the state's lawsuit against Teva Pharmaceuticals Inc., AbbVie's Allergan and their family of companies. The judge agreed to put the trial on hold to give the parties the opportunity to work out a full settlement agreement in the upcoming weeks.

"Today does represent a very big day for our state," Morrisey said later at a news conference.

The trial started April 4. The lawsuit accused the defendants of downplaying the risks of addiction associated with opioid use while overstating the benefits.

Under the tentative deal, West Virginia would receive more than $134.5 million in cash, while Teva would supply the state with $27 million worth of Narcan, a medication that can reverse opioid overdoses, restore breathing and bring someone back to consciousness.

By reaching a settlement, "it obviously puts us in a position where we mitigate risk," Morrisey said. "We could win if we kept going to trial. I think we would have won. No guarantees, of course. But then we might be subject to five years of appeals and then we wouldn't see any resources for five years."

"I want to make sure we start to put feet on the ground now. And I want to see resources targeted to this epidemic now."

Under a plan announced by Morrisey in February, 72.5% of the settlement will go to a nonprofit foundation established to distribute money in opioid-related litigations, 24.5% would be allocated to local governments and 3% would go to the state. The foundation would consist of an 11-member board, including five state appointees and representatives from six regions of the state. The board members will have expertise in fields such as mental health, substance misuse and law enforcement.

West Virginia had reached a $99 million settlement with drugmaker Johnson & Johnson's subsidiary Janssen Pharmaceuticals Inc. last month over the drugmaker's role in perpetuating the opioid crisis in the state that has long led the nation in drug overdose deaths.

Before the trial started, Morrisey's office announced the state settled part of the lawsuit involving another defendant, Endo Health Solutions, for $26 million.

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In separate, similar lawsuits, the state of West Virginia previously reached a $37 million settlement with McKesson Corp. in 2019, and $20 million with Cardinal Health Inc. and $16 million with AmerisourceBergen Drug Co. in 2017.

After years of lawsuits, drugmakers, distribution companies and some pharmacies have been settling cases over the toll of opioids.

In deals finalized this year, the three biggest distribution companies and drugmaker Johnson & Johnson agreed to settlements totaling $26 billion over time. OxyContin maker Purdue Pharma is in court trying to win approval for a national settlement including up to $6 billion in cash, plus using future profits from a remade version of the company to fight the opioid crisis.

In other settlements this year, the distributors have agreed to pay Washington state, which did not participate in the national settlement with them, more than $500 million, and a group of companies are sending $276 million to Alabama.

In all, proposed and finalized settlements, judgements and criminal penalties over opioids have reached more than $47 billion since 2007. Much of the money is to be used only to address the crisis, which has been linked to the deaths of more than 500,000 Americans in the last two decades. A relatively small portion of the settlement money – at least $750 million in the Purdue deal – is to be paid to individual victims and their survivors.

In Charleston, a separate bench trial wrapped up last summer in a federal lawsuit accusing AmerisourceBergen, Cardinal Health and McKesson of fueling the opioid crisis in Cabell County and the city of Huntington. That judge has not indicated when he will rule.