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What does a $260 million settlement suggest for future opioid drug cases?

Monday was supposed to be the start of a landmark trial against drug companies and distributors. But before arguments could start, several companies announced a $260 million settlement with two Ohio counties. With lawsuits still pending from thousands of communities, can a bigger national settlement be reached? William Brangham talks with Lenny Bernstein of The Washington Post for more.

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  • Judy Woodruff:

    Today was supposed to be the start of a landmark trial against drug companies and distributors for their respective roles in the opioid epidemic and the devastating toll it has left across the country.

    But just hours before a jury was set to hear arguments, several companies announced a settlement with a pair of counties in Ohio. This trial was expected to set the benchmark for more than 2,000 other lawsuits against the companies.

    As William Brangham tells us, that reckoning has been delayed, for now.

  • William Brangham:

    Today's $260 million settlement covers just two of the roughly 2,400 cities, counties, states and Native American tribes that have suits pending against the major corporations involved in the distribution and sale of opioids.

    This settlement involves the big three distributors, McKesson Corporation, AmerisourceBergen, and Cardinal Health, as well as Teva Pharmaceutical, which is an Israeli drugmaker.

    But thousands around the country are watching to see whether a much bigger national settlement can be reached, possibly as high as $50 billion.

    Let's look at how this deal took shape and what comes next.

    Lenny Bernstein of The Washington Post has been covering this case from the very beginning. He's in Cleveland, where the settlement was announced.

    Lenny, welcome back to the "NewsHour."

    Before we get to these other thousands of cases that are still pending, some form of an agreement, tell us what was settled late last night between these two Ohio counties.

  • Lenny Bernstein:

    What the counties and the drug companies have agreed on is that, instead of going to trial, the big three distributors will provide $215 million in cash, and Teva will provide another $20 million in cash and anti-addiction drugs.

    That money goes as quickly as possible to the people in Cuyahoga and Summit counties, who need it for treatment, for law enforcement, to take care of foster children, for all the needs created by the opioid epidemic.

  • William Brangham:

    And my understanding is everyone is watching this particular case, the one that was just settled, to see it as something of a bellwether.

    How would a jury react to the evidence presented? How would a jury react to the counterarguments made. Is that right?

  • Lenny Bernstein:

    Precisely.

    This was chosen by the federal judge, Dan Polster, as a bellwether, a litmus test, of how other communities might fare at trial. Well, you didn't have a trial. So the jury didn't get the numerous questions that the plaintiffs were going to put before them in their effort to say that these drug companies are culpable for the epidemic.

    What you got instead was a negotiated settlement. So, that gives us some data, a reference point, but it doesn't give us an up or down on the drug companies' behavior.

  • William Brangham:

    Just to bring people who may not be following this that closely up to speed, can you just remind us, briefly, what are the plaintiffs arguing, what are the defendants arguing in these multitude of cases?

  • Lenny Bernstein:

    Sure.

    Let's start with this one. The plaintiffs argued that the drug companies created a public nuisance — that is, they endangered the health of residents of Cuyahoga and Summit counties, by pouring all these opioids into the public domain, where, inevitably, some portion of them would be diverted to illegal use.

    They also accused the drug companies as acting as a cartel, almost like a drug cartel, by working in concert to spread the message that these drugs were not that addictive and that they could be used for a wide variety of aches and pains, but actually only intended for cancer pain, end-of-life care, certain diseases that are extremely painful.

    So, many of the other plaintiffs have adopted similar arguments. In fact, the public nuisance argument that I referred to carried the day in Oklahoma, where a state judge agreed that Johnson & Johnson had created a public nuisance, and ordered that company to pay $572 million.

  • William Brangham:

    And my understanding, too, is that the companies themselves have argued, look, we were operating in a regulated market. The FDA, the DEA, they were all supposed to be looking after this, and that we were — we were really not guilty in all of this.

    But I wonder if you could just tell me, help us understand now. If the — if a jury trial wasn't held, and this settlement is a bellwether of sorts, what are we to read from this settlement for all of these other cases?

  • Lenny Bernstein:

    Well, it's fuzzy, but it's more information than we had before.

    Thousands of other communities are looking at this settlement right now, as well as the drug companies themselves. They're looking at this settlement. And everybody is trying to assess the strengths and weaknesses of their relative positions.

    There's also the attorneys general who have sued the drug companies in state courts. And they want in on the action as well. So everyone is trying to assess the strengths and weaknesses of their position in this sort of global negotiation, which is very fluid, and trying to come up with where they might position themselves to gain the most.

    Now, we know that the drug companies are not going to hand out 280 — I'm sorry — $260 million to thousands of counties. There's just not enough money for that. So where do we go from here?

    How do we negotiate? Some people are going to have to come up, some people are going to have to come down, some people are going to have to change their time frames, if a deal is going to get done.

  • William Brangham:

    My understanding from some recent reporting is that there's a bit of a dividing line amongst the litigants in this case, that some attorneys general are seeming to want to push for a tougher fight, and others seem to be more ready to settle.

    Is that — is that how you read it?

  • Lenny Bernstein:

    Yes, but that's largely in the Purdue Pharma case.

    As some people — your viewers may remember, Purdue Pharma is also trying to craft a huge nationwide settlement that would get rid of all the litigation against them over OxyContin.

    And the attorneys general are divided roughly along party lines. More Republicans are interested in settling with Purdue, where Democrats are interested in pushing harder for more money, particularly money from the Sackler family, which owns the — owns the company.

    Now, all of that is playing out in bankruptcy court, a totally separate venue from the ones that we have already talked about.

  • William Brangham:

    Is there any chance — I mean, this judge in Ohio has said he wants to bring all of the parties together and force a settlement.

    Is there any chance, from your reporting, that a grand settlement may not actually come to pass?

  • Lenny Bernstein:

    Well, the alternative is really sort of untenable.

    Imagine if 2,400 cities and counties, one by one, went through lawsuits, or right up to the edge of a lawsuit, as Cuyahoga and Summit did today, again and again and again and again against various drug companies, some against the pharmacies, some against the distributors, some against the manufacturers.

    We would be at it for decades. So I think there is little alternative to some kind of a widespread, global negotiated settlement. But, right now, we're not there.

  • William Brangham:

    All right, Lenny Bernstein of The Washington Post, thank you very much.

  • Lenny Bernstein:

    My pleasure.

  • Editor’s Note:

    The headline previous stated the sum incorrectly as $260, and has been updated to reflect it was $260 million.

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