The three largest U.S. drug distributors, who are accused of helping fuel the opioid crisis that has resulted in nearly 500,000 overdose deaths in the U.S., will defend themselves in a trial that kicks off today, Reuters reported. The trial against AmerisourceBergen Corp., McKesson Corp. and Cardinal Health Inc. in Charleston, West Virginia, involves a lawsuit seeking more than $1 billion brought by the city of Huntington and Cabell County. They claim that the companies ignored red flags that opioids were being diverted to illegal channels, flooding the state with hundreds of millions of highly addictive pills. The distributors have denied the claims, arguing they cannot be liable for distributing pills that were prescribed by doctors. Huntington and Cabell, along with other West Virginia towns and counties, opted out of a proposed $26 billion nationwide settlement with the three distributors and drugmaker Johnson & Johnson. A verdict in the trial could help lay the groundwork for settlements in the sprawling nationwide litigation over the opioid crisis, which encompasses more than 3,300 lawsuits by local governments around the country against opioid manufacturers, distributors and pharmacies. Read more.
In related news, the Sackler family who own Purdue Pharma, the maker of Oxycontin, have for months tried to portray their bid for immunity from future opioid lawsuits as a kind of fait accompli, a take-it-or-leave it fix to a legal morass. In exchange for what amounts to a legal firewall for the Sacklers and their remaining empire, members of the family have offered to forfeit control of their bankrupt drug company and pay $4.2 billion from their private fortunes. Judge Robert Drain who is presiding over the case in White Plains, N.Y., has suggested such a deal may be desirable and achievable along these broad lines. A negotiated settlement could preempt years of costly litigation — the Sacklers deny any wrongdoing — and might accelerate financial aid to communities struggling to recover from an opioid epidemic that has already cost more than 450,000 lives. But a growing group of public officials and activists are mounting a last-ditch effort to derail the plan, describing it in legal briefs as an unethical, and possibly unlawful, use of the bankruptcy court's power, NPR reported. Late last week, 25 state attorneys general filed a new brief describing the proposed settlement as "unprecedented," "unjust" and "unconfirmable as a matter of law." "The bankruptcy system should not be allowed to shield non-bankrupt billionaires," said Massachusetts Attorney General Maura Healey. "It would set a terrible precedent. If the Sacklers are allowed to use bankruptcy to escape the consequences of their actions, it would be a roadmap for other powerful bad actors." State AGs aren't alone in objecting to the deal. In recent weeks, attorneys representing local and state governments, native tribes and opioid activists filed briefs raising legal and ethical concerns about the plan. A division of the Justice Department that oversees bankruptcy cases also filed a brief questioning whether the bankruptcy court has the "authority and jurisdiction" to approve such a plan. Read more.
