For more than a year, Colorado has been locked in a high-profile legal battle with Purdue Pharma that has been recently bogged down amid a bankruptcy filing and disagreements over the size of a settlement.
In a separate case, however, the state could soon secure millions of dollars to fight the opioid crisis from five drug makers and distributors it hasn’t even sued. The money would come through a settlement in which the Colorado Attorney General’s Office has been quietly involved in for months.
The state is part of the pending $48 billion agreement with Cardinal Health, McKesson, AmerisourceBergen, Johnson & Johnson and Teva over their alleged role in the nationwide addiction epidemic, the attorney general’s office told The Colorado Sun this week.
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The settlement framework negotiated by attorneys general from New Jersey, Tennessee, Pennsylvania and Texas became public just days ago, grabbing national headlines. It includes $22 billion in cash to be distributed over 18 years and $26 billion in medication-assisted treatment drugs, like buprenorphine, to be released over a decade.
It’s not clear exactly how much Colorado would get under the proposed deal. That would be determined by a formula that hasn’t been finalized. Attorneys general and lawyers representing jurisdictions in all 50 states are expected to be involved.
But it appears the money would be significant when compared to what Colorado is hoping to get from the Purdue case. The resolution of the Purdue case has been slowed by a bankruptcy filing and disagreements over how much the company should pay. Colorado is also suing current and former Purdue executives and the Sackler family, which owns the pharmaceutical giant.
Colorado Attorney General Phil Weiser has said a proposed national settlement deal with Purdue doesn’t go far enough. But he is fully on board with the tentative $48 billion deal with the five other companies.
“If this settlement is finalized, it will provide much needed resources for addiction and treatment services,” Weiser said in a written statement. He called the deal “an example of creative problem solving and what we can do as a nation to meet our toughest challenges when we set our minds to it.”
Weiser has been signaling for weeks that there are other companies in his sights. “Regardless of Purdue and the Sacklers,” Weiser told The Colorado Sun in September, “it is quite clear that there are other entities who have engaged in wrongful conduct.”
But he’s declined to identify the companies.
“Colorado is part of the discussions that have been ongoing with various parties in talks that have been going on with distributors,” Weiser’s spokesman, Lawrence Pachceco, said recently, also declining to name the parties and distributors.
Several of the companies involved in the $48 billion settlement have been accused of, or at least linked to, alleged wrongdoing in Colorado before.
McKesson, for instance, agreed to a $150 million settlement with the Department of Justice for alleged violation of the Controlled Substances Act. The deal included an agreement to close a distribution center in Aurora. Federal prosecutors say the distribution giant “processed more than 1.6 million orders for controlled substances from June 2008 through May 2013, but reported just 16 orders as suspicious, all connected to one instance related to a recently terminated customer.”
The Philadelphia Inquirer reported last year that AmerisourceBergen, another drug distributor, was subpoenaed by federal prosecutors in Colorado, though the newspaper didn’t elaborate on why beyond saying that it was related to how the company handles drug diversions.
The settlement framework says McKesson, AmerisourceBergen and Cardinal came to the table after attorneys general launched an investigation seeking information related to whether they fulfilled their duty to raise red flags about suspicious drug orders by pharmacies.
Johnson & Johnson and Teva, opioid manufacturers, are part of the deal because attorneys general launched an investigation into whether patients and doctors were misled about the addictive nature of the medications.
The Colorado Attorney General’s Office says it doesn’t comment on its investigations.
The one holdup for the $48 billion settlement could be that some lawyers representing communities affected by the crisis are saying the tentative agreement doesn’t go far enough. That’s the same concern holding up the Purdue settlement from being finalized.
Ohio Attorney General Dave Yost called the idea “a pile of lumber,” not a framework, according to The Associated Press. And Paul Hanly, one of the lead lawyers for the local governments, said the companies should be forced to pay more.
Colorado is among the states arguing that the up to $12 billion proposed national settlement with Purdue, the maker of the painkiller OxyContin, is inadequate. Weiser has declined to say if he has a number in mind that would be sufficient, but he has urged the company to return to the negotiating table.
In the meantime, the state is still pursuing its individual lawsuit against Purdue, its current and former executives, and the Sackler family.
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