Opioid Ruling on J&J May Be Good News ... for Big Pharma - Page 2
Johnson & Johnson must pay $572M over opioid crisis, but prosecutors wanted far more
Posted Aug 27, 2019 11:50 AM CDT
- The penalty: State prosecutors wanted the company to pay $17 billion to cover the next 20 years of opioid abatement, but Balkman decreed that paying $572 million to cover one year would suffice, reports the Wall Street Journal. Two other drugmakers, OxyContin-maker Purdue Pharma ($270 million) and Teva Pharmaceutical ($85 million), settled with Oklahoma before going to trial.
Now what: Johnson & Johnson plans to appeal in Oklahoma. But most of the focus on the opioid issue now shifts to Cleveland, where a giant federal lawsuit against drugmakers is scheduled to begin in October, per the Washington Post. The judge presiding over that trial, which consolidates cases from around the country, is actively encouraging a settlement, and Monday's ruling could lay the groundwork for that.
- Hold the celebration: Pharma shareholders should hold off celebrating the relatively good news for Johnson & Johnson, writes Charley Grant at the Wall Street Journal. Yes, it "gives investors some hope that opioid litigation won’t be as destructive as some on Wall Street have feared." But it's too simplistic to apply the decision to future rulings in different courtrooms with different legal strategies at play. The "litigation cloud hanging over drug stocks won’t clear up soon," he writes.
- The poppy fields: So why else did prosecutors go after J&J? The reason begins far away from any US courtroom. Prosecutors say the company had deals with poppy growers in Tasmania that allowed J&J to supply drugmakers with 60% of the opiate ingredients they needed, reports the New York Times. Plus, subsidiary Janssen Pharmaceuticals produced its own opioids. And then there was the aggressive marketing to get doctors to prescribe the drugs.
- Sobering stat: The backdrop of all this is that more than 400,000 people have died from opioid overdoses since 1999, per the Post. That includes deaths from legal painkillers as well as heroin and fentanyl.
(Read more Johnson & Johnson
My Take on This Story
Show results |