Johnson & Johnson Reaches $20.4 Million Settlement in Bellwether Opioids Case

Johnson & Johnson announced Tuesday that it had reached a $20.4 million agreement to settle opioid claims brought by two Ohio counties, becoming the fifth drugmaker to avoid the first federal trial that attempts to hold the pharmaceutical industry accountable for the drug scourge.

The company — which made a fentanyl patch and two versions of an opioid tablet — did not admit wrongdoing. It said in a statement that it was settling “to avoid the resource demands and uncertainty of a trial as it continues to seek meaningful progress in addressing the nation’s opioid crisis.”

The division of Johnson & Johnson that made the opioid products, Janssen Pharmaceuticals, has said that those products accounted for less than 1 percent of total opioid prescriptions written in the United States.

The settlement was not nearly as sizable as the tentative agreement reached by Purdue Pharma with opioid plaintiffs last month, but that deal was intended to release the company from all federal litigation and many state cases as well.

The Johnson & Johnson agreement merely settles two federal lawsuits, which are scheduled to go to trial jointly against other drug industry defendants on Oct. 21. But the trial is an important one. Referred to as a bellwether, it is intended as a litmus test for some 2,300 cases filed by cities, counties and tribes nationwide, that have been consolidated in federal court under Judge Dan A. Polster in Cleveland.

To settle it, Johnson & Johnson has agreed to give a combined $10 million to the Ohio counties of Cuyahoga and Summit plus $5 million to cover the plaintiffs’ legal fees and expenses and $5.4 million in charitable contributions to opioid-related nonprofit programs in those counties.

In comparison, Mallinckrodt Pharmaceuticals, a large maker of generic opioids, tentatively settled with the counties last month for $24 million in cash and $6 million worth of drugs, including addiction treatment medications.

Two other drugmakers, Endo and Allergan, have also settled with the two counties.

The only remaining drug manufacturer in the bellwether trial is Teva Pharmaceuticals, which settled an opioid claim that Oklahoma brought against it earlier this year, shortly before the start of that state’s trial.

In addition to Teva, the defendants still in the Ohio trial include drug distributors such as Cardinal, McKesson and AmerisourceBergen and retail pharmacy chains such as Walgreens.

The drug distributors and retail pharmacy chains, however, have shown little sign of being predisposed to settle. They are continuing to press their efforts to remove Judge Polster from the case, claiming that he has shown a bias against them by openly encouraging settlement talks. Some legal experts have said that such a move, so close to the start of a trial, is highly unusual.

In a statement, the lead lawyers for the federal plaintiffs — Joe Rice, Paul J. Hanly Jr. and Paul T. Farrell Jr. — said that the Johnson & Johnson settlement brought the payment for the two Ohio counties so far to $60 million.

“We continue our preparation ahead of the October 21st trial where we plan to hold the remaining opioid makers and distributors accountable for fueling the crisis that has led to thousands of deaths in Ohio and across the country, ” they said.

As the sprawling federal opioid litigation has unfolded over 20 months, the drug manufacturers have been reported to be more inclined to settlement negotiations than the other groups of defendants. But many legal observers thought that Johnson & Johnson might continue to fight.

In the world of pharmaceutical giants, Johnson & Johnson, which had 2018 sales of $81 billion, is widely known for being more inclined to try lawsuits in court than to settle, most recently in a slew of cases in which plaintiffs alleged that its talc-based baby powder caused cancer in some consumers. When the state of Oklahoma sued drug manufacturers for its opioid crisis, Johnson & Johnson, unlike Purdue and Teva, refused to settle. Instead, it faced the state during a nearly two-month trial. In August, the Oklahoma judge who presided over the trial ordered the company to pay $572 million — a judgment that Johnson & Johnson is appealing.

Johnson & Johnson made two versions of Nucynta, an opioid tablet, which it divested in 2015, and still produces Duragesic, a fentanyl patch, which, the company notes, it has not marketed in the United States since 2008. But during the Oklahoma trial, plaintiffs’ attorneys said that the pharmaceutical giant supplied most of the nation’s opioid material to other drug manufacturers, refined by one of its companies from a variety of poppy that Johnson & Johnson developed and contracted with farmers to grow in Tasmania.

Because of an editing error, an earlier version of this article stated incorrectly the number of drug makers to settle in the first federal case that attempts to hold the pharmaceutical industry accountable for the opioid crisis. Johnson & Johnson is the fifth drug maker to do so, not the fourth.

Jan Hoffman writes about behavioral health and health law. Her wide-ranging subjects include opioids, vaping, tribes and adolescents. @JanHoffmanNYT

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