Before COVID-19 hit, daily headlines swirled around pharma’s role in the opioid crisis and lawsuits piled up against drugmakers. The pandemic delayed those legal fights. But now, the reprieve is over: A major trial is slated to kick off Monday in California.
Johnson & Johnson, AbbVie’s Allergan business, Teva and Endo are set to face a virtual trial over allegations they downplayed risks of opioid addiction to boost sales of the powerful painkillers, according to reports. The counties of Santa Clara, Los Angeles and Orange have sued the companies, along with the city of Oakland, seeking a whopping $50 billion in damages.
It’s the second major opioid case to go to trial after Oklahoma successfully sued J&J in 2019. The state scored $572 million there, but a judge later reduced the award to $465 million. J&J has appealed and “believes that it has strong grounds to overturn this judgment,” the company said in an annual Securities and Exchange Commission (SEC) filing in February.
In the California case, the companies have denied wrongdoing. They contend they simply marketed FDA-approved medicines and say the jurisdictions lack proof that their marketing caused an epidemic, Reuters reports.
More than 3,400 lawsuits from states and cities are now pending against opioid makers and distributors, and this trial could increase pressure on the companies to finalize a settlement.
Last year, J&J and the nation's top three drug distributors—AmerisourceBergen, Cardinal Health and McKesson—proposed a $26 billion settlement with states and cities. The deal is still pending, but J&J has set aside $5 billion to resolve opioid claims, its SEC filing shows.
Teva has offered $250 million in cash and free drugs worth $23 billion to resolve claims against the company, but that proposal is still pending, too. Back in February, Teva CEO Kåre Schultz told analysts he thought the company was “close” to a settlement, but there’s “a difference between being close and getting something signed finally.”
“I think we need some kind of pressure for everybody to get together and do final settlements in this space of opioid litigation,” he added.
Now that trials are resuming following pandemic delays, the pressures of intense and costly litigation could force the sides to reach a deal.
Meanwhile, the three distributors are set to face a trial in West Virginia next month, Reuters reports. Another trial is slated for June in New York in a case against drug manufacturers and distributors.
Nearly 500,000 people died from an opioid overdose between 1999 and 2019, the Centers for Disease Control and Prevention says.
Aside from the four drugmakers facing trial in California, another opioid supplier, Purdue Pharma, has filed for bankruptcy and is negotiating a deal to pay out billions to its creditors.