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Teva reaches proposed settlement on opioid lawsuits



(Reuters) — Teva Pharmaceutical Industries on Tuesday announced a proposed nationwide settlement that could resolve thousands of lawsuits over the drugmaker’s alleged role in the U.S. opioid epidemic.

The proposal calls for Teva to pay state and local governments up to $3.7 billion in cash over 13 years, plus a $1.2 billion contribution of the drug naloxone to reverse opioid overdoses. Israel-based Teva will also pay about $100 million to Indian tribes and pay legal fees incurred by states, local governments and tribes.

Teva’s proposed settlement would allow state and local governments to opt for additional cash in lieu of an allocation of the overdose medication, worth 20% of the drug̵

7;s list price.

The cash portion of the settlement is higher than Teva’s CEO proposed in May.

CEO Kare Schultz told analysts at the time that he expected the company to pay about $2.6 billion in cash and medicine to reach a nationwide settlement.

The proposed settlement comes as Teva’s New York shares have fallen 11% so far this year amid a cloud of uncertainty surrounding an opioid settlement.

Teva, which still has about $20 billion in net debt, had sought a deal that included less cash and more medicine, but some states and counties opposed it, questioning the value of the medicine, which was produced far cheaper than the prices used in the settlement agreements. .

Iowa Attorney General Tom Miller, a lead negotiator for the states, called it “another big step in addressing the opioid crisis.”

“We expect these agents will make a significant difference in preventing fatal overdoses and treating opioid addiction,” said Mr. Miller.

Teva’s settlement is contingent on separate settlements from AbbVie’s Allergan unit. Teva acquired Allergan’s generic drug business in 2016.

For the Teva deal to take effect, Allergan must reach its own nationwide opioid settlement, and the two companies must resolve a dispute over the amount Allergan owes Teva for claims filed before the 2016 sale.

Allergan did not immediately respond to a request for comment.

The Teva settlement will not be completed unless a sufficient number of state and local governments agree to accept the terms. Teva has already agreed to settlements with West Virginia, Texas, Florida, Rhode Island and Louisiana, the value of which will be included in the proposed $3.05 billion cash payout.

New York State will not participate in the settlement and continues to seek a judgment against Teva. A New York jury found the company responsible for the state’s opioid crisis in December.

US states, cities and counties filed more than 3,000 lawsuits against opioid manufacturers, distributors and pharmacies, accusing them of downplaying the risk of abuse and failing to stop pills from being diverted for illicit use.

The U.S. opioid crisis has caused more than 500,000 overdose deaths over the past two decades, including more than 80,000 in 2021 alone, according to government data.


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