British company Reckitt Benckiser has agreed to pay $1.4 billion to resolve and effectively end all US investigations and claims against the company stemming from opioid related injuries and deaths. The amount of the settlement is the largest yet to be paid by one firm in the ongoing opioid crisis.
Reckitt Benckiser denied wrongdoing but said the settlement deal “avoids the costs, uncertainty and distraction associated with continued investigations, litigation and the potential for an indictment.”
The company’s former Indivior division, spun off in 2014, makes an opioid-addiction drug called Suboxone Film that dissolves under the tongue. In April, the Justice Department charged Indivior with felony fraud and conspiracy.
Federal prosecutors said that starting in 2010, Indivior falsely marketed its film as being safer and less prone to abuse than cheaper tablet forms, illegally earning billions of dollars in a “nationwide scheme” to bilk healthcare providers and insurers including Medicaid.
The amount of the settlement should make one wonder what the company was hiding or the extent of liability they may have been facing if they hadn’t settled. It is also an indication of just how much money the British firm has made from opioid sales.
In announcing the Reckitt Benckiser settlement, the Justice Department noted that Suboxone is a medication designed to help people suffering from opioid dependency. “Drug manufacturers marketing products to help opioid addicts are expected to do so honestly and responsibly,” said Assistant Attorney General Jody Hunt.
Most of the $1.4 billion will go to various federal agencies, but $200 million will be divided up among states that sign on to the settlement deal, with the money going to reimburse their Medicaid budgets.
While the payout is noteworthy for its size, this has been a year of reckoning across the pharmaceutical industry. Insys Therapeutics, Purdue Pharma and Teva Pharmaceutical Industries have agreed to pay state and federal agencies a combined total of more than half a billion dollars to settle opioid-related claims.
In May, seven current and former Insys executives pleaded guilty to or were convicted of federal racketeering conspiracy charges tied to the marketing of opioid medications. That company later declared bankruptcy. Purdue Phama has talked openly about filing for Chapter 11.
