States across the country have sued major opioid distributors and pharmaceutical companies for compensation due to the unscrupulous practices that have helped to facilitate the opioid crisis. The Wall Street Journal reports that a large $18 billion settlement that pharmaceutical companies were offering up to make these lawsuits end has “fallen apart” and that a letter, rejecting the terms of the settlement, signed off by 21 of the state attorneys general, as well as Puerto Rico and the District of Columbia, was sent to the companies’ law firms.
The original settlement offer, as it stood, would include paying out the $18 billion over 18 years. The settlement talks have been going on since October, and proceeded the Sackler family’s attorney floating a $10-$12 billion settlement last summer. That offer was roundly criticized as even low estimates have put the financial costs of opioid crisis at around a quarter of a trillion dollars.
Criticism of this new settlement, as explained by Ohio Attorney General Dave Yost, is that either the company has to offer up that $18 billion in a shorter timeframe, or a lot more money over the long haul. A reasonable price tag for this settlement, according to the WSJ’’s sources, would be between $22 billion and $32 billion. Ohio hired an outside firm to analyze the opioid companies’ finances in regards to the settlement offer and found that it would have “limited or no impact on the companies’ finances.” By that estimation, the drug companies could part with a lot more money than they have been willing to part with and still be viable businesses.
Republican Yost was pressed into action by Ohio county prosecutors who began the process of suing companies over the opioid epidemic. The public health crisis has hit Ohio particularly hard, with some of the highest overdose rates due to opioids in the country. Before that historic trial could get underway, two counties agreed to a $260 million settlement.
The balance being struck here is getting as much money as possible out of these drug companies without bankrupting these companies and receiving less as a result. Of course, any time a multibillion dollar company begins to plead poverty, one needs to be skeptical. History has shown us that the greediest amongst us have very little interest in anything but greed. A recent example would be the Sackler family, who created Purdue Pharma—a company best known for producing and profiting off of OxyContin—who have tried to plead bankruptcy while filtering billions of dollars into private accounts.
The WSJ says that North Carolina, Texas, Pennsylvania, and Tennessee did not sign off on the rejection letter.