- Endo on Tuesday announced a deal in principle to settle with two Ohio counties suing drugmakers over their role in fueling a crisis of opioid addiction and overdose in the U.S.
- Under the agreement, which has yet to be finalized, Endo would pay $10 million in cash and provide as much as $1 million worth of its Vasostrict and Adrenalin products to the counties without charge.
- The company framed the agreement as a way to avoid the costs and risks of litigation and noted that it won't include any admission of wrongdoing or liability. Endo still faces other opioid-related litigation that SVB Leerink analysts estimate could result in a potential $1.8 billion nation-wide settlement sum — although the company cautioned against extrapolating from the $10 million number announced Tuesday.
The case in Ohio is being closely watched as a test of opioid lawsuits. Cuyahoga and Summit counties were chosen to lead “Track 1” cases, with a trial set to begin in October.
Allergan has also tentatively agreed to at least a partial settlement, Reuters reported Tuesday. The company would pay $5 million to resolve claims over branded opioids but may still face trial over its generics, the report said. Allergan officials did not return emails from BioPharma Dive requesting comment.
Both Endo and Allergan are named in other lawsuits, and the case in Ohio is proceeding against larger drugmakers including Johnson & Johnson and Purdue Pharma as well. J&J is also due to hear a verdict in an opioid case in Oklahoma on Monday, according to Seeking Alpha.
The free product component of the proposed Endo settlement may happen more in future cases, Cantor Fitzgerald analyst Louise Chen wrote in a note to investors.
“This would help companies involved in the opioid cases to avoid taking on more debt to settle things out, and it looks good for regulators because they are getting free product for patients,” Chen wrote.
About two-thirds of the 70,000 drug overdose deaths in 2017 can be attributed to opioids, according to the Centers for Disease Control and Prevention. The crisis has drawn attention at all levels of government, with President Donald Trump highlighting the problem and cities, counties and states taking the manufacturers to court.
Endo itself is a smaller player in opioids, but its subsidiary Par Pharmaceuticals accounted for nearly 16% of the opioid pills sold in the U.S. between 2006 and 2012, according to an analysis by the Washington Post.
The $10 million cash payment is on par with the legal costs Endo expected to face with a trial. If a more global government settlement is reached, the two counties would still be able to participate, minus the funds paid by Endo already, the company said.
“It is important to note that the value of the settlement should not be extrapolated to any other opioid-related cases or claims,” said Matthew Maletta, Endo's chief legal officer, in the company's statement.