Teva, an Israel-based drug manufacturer, makes Actiq and Fentora, which are branded fentanyl products for cancer pain, and a number of generic opioids including oxycodone. Teva has reached an agreement in principle with the working group of States’ Attorneys General, counsel for Native American Tribes, and plaintiffs’ lawyers representing the States and subdivisions, on the primary financial terms of a nationwide opioids settlement.
The California Attorney General also said that an agreement in principle on key financial terms with opioid manufacturer Teva. The agreement would provide up to $4.25 billion to participating states and local governments to address the opioid crisis. While critical details of the settlement remain the subject of ongoing negotiations, Teva disclosed the agreement Tuesday ahead of its earnings announcement Wednesday.
States alleged that Teva:
– – Promoted potent, rapid-onset fentanyl products for use by non-cancer patients;
– – Deceptively marketed opioids by downplaying the risk of addiction and overstating their benefits, including encouraging the myth that signs of addiction are actually “pseudoaddiction” treated by prescribing more opioids; and
– – Failed to comply with suspicious order monitoring requirements along with its distributor, Anda.
The parties have agreed on the following financial terms:
– – Teva will pay a maximum of $4.25 billion in monetary payments over 13 years. This figure includes amounts Teva has already agreed to pay under settlements with individual states, funds for participating states and local governments, and the $240 million of monetary payments in lieu of product described below.
– – As part of the financial term, Teva will provide up to $1.2 billion in generic naloxone (valued at Wholesale Acquisition Cost or WAC) over a 10-year period or $240 million of cash in lieu of product, at each state’s election. Naloxone is used to counteract overdoses.
– – The settlement will build on the existing framework that states and subdivisions have created through other recent opioid settlements.
States, localities and tribes must ratify the proposed settlement, and a final settlement remains contingent on agreement on critical business practice changes and transparency requirements. The agreement is also contingent upon final documentation among the working group and Teva, and reaching the thresholds for participation that will be set forth in the final agreement.
The agreement is also contingent upon Teva reaching an agreement with Allergan with respect to any indemnification obligations, and Allergan reaching a nationwide opioids settlement.
There are no remaining trials currently scheduled against Teva in 2022, with the possible exception of the relief phase of the trial in the New York opioids litigation; additionally, Teva, New York State, and its subdivisions are engaged in ongoing settlement negotiations.
The negotiations are being led by the following states: California, Illinois, Iowa, Massachusetts, New York, North Carolina, Pennsylvania, Tennessee, Texas, Vermont, Virginia, and Wisconsin. While New York is among the 12 states that negotiated this proposed settlement framework, Teva and New York are still engaged in further negotiations.