The Israeli drugmaker Teva Pharmaceuticals has agreed to a proposed $4.25 billion deal to resolve thousands of lawsuits brought by states, other jurisdictions and, for the first time in a national settlement, Native American tribes over the opioid epidemic.
If the deal is finalized, the company would pay $3 billion in cash and $1.2 billion in donated Narcan, the overdose-reversing drug, over 13 years. Approximately $100 million would be distributed to the tribes.
The sum includes $650 million that the company already agreed to pay when settling cases with Texas, Florida, West Virginia and others.
The governments that sign on to the deal can opt to receive the overdose-fighting medication rather than cash, Teva said.
The national plaintiffs’ committee of attorneys representing thousands of cities and counties in the opioid litigation called the settlement “a vital step” that would offer help to those on the front lines of the epidemic. More than 100,000 Americans died of drug overdoses in 2021, according to federal data, a record high.
“We encourage all these groups to sign onto this agreement to allow these resources to get into the hands of those who need them as fast as possible,” the committee said in a statement after the deal was announced.
Attorneys general involved in the negotiations heralded the news of the agreement. Connecticut Attorney General William Tong called it “a significant breakthrough in our fight to hold the entire addiction industry accountable,” and California Attorney General Rob Bonta said it “will provide much-needed relief for victims.”
“Teva downplayed the risk of addiction when it marketed its opioids and overstated potential benefits, deceiving doctors and patients,” Pennsylvania Attorney General Josh Shapiro said in a statement. “Today’s settlement ensures Teva will pay for its irresponsible actions, with funds going directly to communities in Pennsylvania most impacted by the opioid epidemic.”
Teva has denied accusations raised during the litigation, saying it legally produced generics and marketed its branded fentanyl-based lozenges Actiq and Fentora.
The company, which shared the news of the agreement in its second-quarter earnings report, would be giving more than $2.7 billion to $3.6 billion, the range chief executive Kare Schultz estimated for the settlement in February. Last year, Teva made about $16 billion in sales globally.
“While the agreement will include no admission of wrongdoing, it remains in our best interest to put these cases behind us and continue to focus on the patients we serve every day,” the company said in a statement on Tuesday.
The agreement is contingent on several factors: The final terms are likely to be ironed out in writing in “coming weeks”; Allergan, a generics maker acquired by Teva in 2016, must also sign off; and a vast majority of the governments suing the company must agree to the deal once it is finalized.
The agreement comes after a New York jury found the company responsible for the state’s opioid crisis in December. New York did not join the national deal, and the company said it is still negotiating with the state and its communities.
There are no remaining trials scheduled against Teva in 2022.
The deal also follows several others with similar terms. The three biggest wholesalers — AmerisourceBergen, Cardinal Health and McKesson — agreed to a $21 billion nationwide settlement alongside a $5 billion deal with drugmaker Johnson & Johnson. OxyContin maker Purdue Pharma is pushing forward with a $10 billion bankruptcy plan to resolve litigation and become a public benefit company. Mallinckrodt, the leading opioid maker, made a $1.6 billion nationwide deal in bankruptcy court.
The Teva deal is a first in a significant respect: Other agreements the drug companies reached with states and communities typically have not included Native American tribes. The tribes usually reached their deals after the states. At the same time, the increase in drug overdose deaths has disproportionately affected Indigenous people in the United States. (The toll rose 39 percent among Native Americans compared with an increase of 22 percent among Whites in 2020, according to a report by the Centers for Disease Control and Prevention published Friday.)
Lloyd Miller, a lead attorney for the tribes, called their inclusion in the Teva agreement “game changers for future litigations.”
“It reflects a fundamental shift in the development of the law toward greater parity between tribal governments and States,” Miller wrote in an email.