Erie County to share in $10 billion opioid settlement with 2 big pharmacy chains
Just two months after suing five chain pharmacies over the opioid crisis, Erie County is line to get a settlement from two of them.
The county expects to get a piece of the $10 billion settlement that CVS Health and Walgreen Co. reached in principle to end lawsuits nationwide over the effects of opioids, the solicitor for Erie County said.
CVS and Walgreens — the two largest pharmacy chains in the United States — are two of the five chains the county sued in Erie County Common Pleas Court on Sept. 7. The others are Walmart, Rite Aid and Giant Eagle.
"We anticipate being part of the settlement, but the amount and terms still need to be determined," the county solicitor, William Speros, said on Thursday.
Speros commented a day after Walgreens and CVS announced the proposed settlement. Each chain would pay $5 billion to close out the thousands of lawsuits that governments nationwide have filed against them. Walmart is in discussions for a deal of its own, according to the Associated Press.
The suits, including Erie County's, claim the pharmacy chains fueled the opioid epidemic by negligently saturating the local market with prescription painkillers despite warning signs over suspicious orders. The suits against the pharmacies followed suits against drug distributors.
The proposed settlement in the pharmacy suits concerns only Walgreens and CVS. Erie County would continue to sue the chains that do not reach settlements, Speros said.
Settlement would benefit opioid-related programs in Erie
The money from the proposed settlement with Walgreens and CVS is all but certain to help fund programs to aid the county in fighting opioid addiction, as has been in the case with proceeds from similar settlements. Speros said more negotiations must occur before the settlement becomes final for Erie County and other plaintiffs, including state governments.
"We anticipate being part of the settlement, but the amount and terms still need to be determined," Speros said.
Under the proposed settlement, neither Woonsocket, Rhode Island-based CVS nor Deerfield, Illinois-based Walgreens is admitting wrongdoing, according to the AP.
New Erie County lawsuit related to other opioid cases
The AP also reported the settlement plans spring from mediation involving a group of state attorneys general. Before they move ahead, state and then local governments would need to sign on. So far, the detailed, formal deals have not been presented to the government entities so they can decide whether to join.
Under the tentative plans, CVS would pay $4.9 billion to local governments and about $130 million to Native American tribes over a decade. Walgreens would pay $4.8 billion to governments and $155 million to tribes over 15 years. The exact amount depends on how many governments join the deals, according to the AP.
Erie County sued the five pharmacy chains shortly after as it started to receive payments in another large case related to the opioid epidemic. The county was part of a settlement involving lawsuits several states filed against three major pharmaceutical distributors — Cardinal Health, McKesson and AmerisourceBergen — as well as opioid manufacturer Johnson & Johnson.
The county received $673,818 in September, the first of 17 payments the county will receive on an annual basis until 2039. The county is expected to receive a total of nearly $16 million from the settlement. The money must go toward opioid prevention, treatment or any of a wide range of opioid remediation uses.
The Erie County District Attorney's Office was involved in a separate lawsuit against the same drug companies. That office is to receive about $1.8 million through 2039, with an initial payment of $217,805. The money is to fund programs for prevention, education and abatement related to the opioid crisis.
Erie County case aligned with successful Ohio suit
The county's lawsuit against the pharmaceutical chains was based on strong precedent.
The case is similar to a lawsuit that led to a $650 million judgment following a jury verdict against CVS, Walgreens and Walmart in federal court in Cleveland in November. The plaintiffs in that case were Lake and Trumbull counties, both outside Cleveland. Two other defendants — Rite Aid and Giant Eagle — settled with the counties before trial.
That case represented the first national trial against national chains over the opioid crisis. Following the verdict, the judge held another hearing to determine damages and awarded the $650 million in August.
In the Erie County case, the county is claiming the pharmacies contributed to the county getting flooded with opioids. Citing federal data, the suit states that 103,169,505 doses of the opioids hydrocodone and oxycodone were prescribed in Erie County in 2006-2014. That amounts to "379 doses for every man, woman and child in the County," according to the suit.
CVS, Walgreens comment on proposed settlement
The pharmaceutical companies have yet to respond to the county's lawsuit in court. CVS and Walgreens issued statements with Wednesday's announcement about the proposed $10 billion settlement.
"We are pleased to resolve these longstanding claims and putting them behind us is in the best interest of all parties, as well as our customers, colleagues and shareholders," Thomas Moriarty, CVS chief policy officer and general counsel, said, according to the AP.
Walgreens said in its statement, according to the AP: “As one of the largest pharmacy chains in the nation, we remain committed to being a part of the solution, and this settlement framework will allow us to keep our focus on the health and wellbeing of our customers and patients, while making positive contributions to address the opioid crisis."
Contact Ed Palattella at epalattella@timesnews.com. Follow him on Twitter @ETNpalattella.
This article originally appeared on Erie Times-News: $10 billion opioid settlement with drugstores to benefit Erie County
