Opioid settlements could provide more than $23 billion in medicine to treat addiction — but health-care providers say that won’t go far enough

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Two Ohio counties will get a three-year supply of a medication combatting opioid dependency under an opioid litigation settlement reached this week, and drugmaker Teva could pay for a 10-year national supply of the medicine under a separate proposed settlement.

But considering government estimates that 130 people die daily from opioid-related overdoses and 10.3 million people misused prescription painkillers last year, how much of a difference can a steady supply of the medication make to stop the crisis?

Israel-based pharmaceutical company, Teva TEVA, -1.25%, was poised to go to trial in Ohio federal court alongside drug distributors AmerisourceBergen ABC, -0.48% Cardinal Health CAH, -1.42% and McKesson MCK, -0.59% and the pharmacy-chain Walgreens WBA, -1.37%.

But an 11th-hour settlement averted the trial.

The three-year supply of Suboxone, a drug combatting opioid dependency, to two Ohio counties is part of a $260 million settlement that drug distributors and the drugmaker reached Monday to avoid a closely-watched trial over the companies’ alleged responsibility for the opioid crisis.

Under a much broader potential $48 billion pact to end the multitude of cases against the drug maker, Teva, drug distributors and other corporate defendants, Teva could provide a 10-year national supply of the drug.

The Ohio trial was expected to be the first benchmark case holding pharmaceutical companies to account for allegedly contributing to the nation’s opioid epidemic. All the companies except Walgreens reached a last-minute settlement. A Walgreens spokesperson told MarketWatch it never marketed, prescribed or made opioids.

Cuyahoga and Summit counties in Ohio agreed to a settlement with the companies, which were accused of recklessly prescribing and distributing drugs that contained the powerful opioid medications oxycodone and fentanyl.

The companies are not admitting any liability in the settlement. The distributors said they “strongly dispute” the allegations in the now-settled trial but said a deal was an “important stepping stone” working out a broader deal to address the epidemic.

The distributors will pay $215 million to two counties and Teva will pay $20 million in cash and supply $25 million worth of its brand name addiction treatment drug Suboxone under the terms of the settlement.

This Ohio case was to be the first federal test case of more than 2,000 lawsuits from states, counties and cities, but there have been other state-level cases.

This summer, an Oklahoma state judge ruled Johnson & Johnson contributed to the opioid crisis and subsidiaries and ordered a $572-million payment. He later scaled the judgment down to $465 million, admitting a calculation error. Johnson & Johnson JNJ, +0.54%   is appealing the case, saying it followed all laws.

Will the settlement providing Suboxone help patients?

“It’s one piece of the puzzle, but it’s a welcome addition to the puzzle,” said Dr. Paul Earley, president of the American Society of Addiction Medicine, a medical society representing around 6,000 doctors, clinicians and other industry professionals. Many people fighting opioid addictions are homeless or “terribly financially strapped” and “having more access to medication that’s properly prescribed is a good thing,” he noted.

People with insurance can pay between $100 and $300 every month for Suboxone, “a good, life-saving drug,” according to Dr. Lantie Jorandby, the chief medical officer of Lakeview Health, a Jacksonville, Fla.-based addiction treatment center.

Some opioid-addiction fighting drugs cost far more, Jorandby added. Insured patients can pay upwards of $1,000 a month for Vivitrol, the brand term for Naltrexone, another medicine to fight opioid and alcohol dependence, and patients without coverage can pay up to $1,500, she said.

Like Earley, Jorandby said more medicine isn’t a cure-all, adding that adequate medical access, insurance coverage and effective treatment methods all have to be addressed if any court settlements are going to thwart the country’s opioid epidemic.

The distributors noted their payout in the settlement with the two Ohio counties is expected to fund treatment and rehabilitation programs, as well as mental health services.

Josh Shapiro, Pennsylvania’s Attorney General, said the possible deal they’ve hashed out would carve up the money between the 50 states. From there, 70% of the state’s share would go towards treatment and support services, while 15% of the money would go to the treasury departments of local municipalities and the other 15% share would go to the state’s treasury department. “We want to see the money go to this crisis existing today,” he said.

Teva could provide a 10-year national supply of Suboxone

Also this week, attorneys general from North Carolina, Pennsylvania, Tennessee and Texas said they reached a “proposed settlement framework” with Teva, AmerisourceBergen Cardinal Health, McKesson and Johnson & Johnson to settle all the cases against them.

The $48-billion proposal would include a $22-billion cash payment, as well as the supply and distribution of generic Suboxone — supplies and services valued at a total $26 billion.

“Teva is agreeing to provide 100% of the national demand for product over 10 years,” North Carolina Attorney General Josh Stein told reporters, valuing the cost of that medicine at $23-billion. “If demand is greater, then their contribution will be greater,” he added. Teva would also pay $250 million cash in the deal.

Teva’s statement said it would donate the medicine “in quantities of up to the amount needed to meet the majority of the currently estimated U.S. patient need over the next 10 years.”

It said it was “pleased to positively contribute to solving the nationwide opioid epidemic,” adding, “Teva has consistently committed to complying with all laws and regulations regarding its manufacture and sale of opioids. Neither settlement includes an admission of liability.”

But the $48-billion proposal is not a done deal. The four attorneys general acknowledged they needed to persuade other states, counties and cities to agree. That’s not a given. For example, Ohio Attorney General Dave Yost said in a statement, “This isn’t a framework, it’s a pile of lumber that’s been dropped on the construction site. Ohio will wait and see what the detailed plan looks like.”

Purdue Pharma, the maker of OxyContin, reached a tentative settlement in September with approximately half of the more than 2,000 state and local government cases, but the company is in bankruptcy proceedings.

There’s demand for Suboxone, but not enough prescribers, experts say

“We’re going to burn the midnight oil to create this settlement document and put it into practice,” Stein, the North Carolina attorney general, said Monday. But real-life application of any legal deal might not be so simple. Many treatment roadblocks are about what patients can afford, not any party’s legal liability.

“Overall, the access to buprenorphine is insufficient to curb the tide of this epidemic,” said Earley, referring to Suboxone’s generic name. “Anything that will help access to the medication is the right thing to do.”

Patient demand is strong, but there’s an “inadequate number of prescribers,” he said.

Doctors, nurse practitioners and physicians assistants all need special waivers to prescribe buprenorphine to patients with opioid-use disorders, Earley noted. More than 74,000 doctors, nurse practitioners and physicians assistants have the waiver, according to the Substance Abuse and Mental Health Services Administration.

There are 480,000 primary-care physicians alone in the country, according to the Kaiser Family Foundation, a nonprofit organization focused on public health and health policy. There’s also “inadequate access to prescribers,” Earley noted. He said that happens because many patients lack the money or the awareness about the services out there, especially in rural areas.

Even if patients find treatment, Gary Mendell, founder and CEO of Shatterproof, a Norwalk, Conn.-based nonprofit, said too many addiction-recovery services think people can beat their addictions by quitting opioids cold turkey, rather than with the help of medications like methadone or Suboxone.

“It’s extremely important and life-saving that this money gets used based on science, not based on outdated belief” about getting sober by abstaining, said Mendell, whose organization fights to destigmatize addiction and promote evidence-based treatment.

But even if doctors and treatment centers are ready, willing and able to prescribe Suboxone and other opioid-fighting medication, insurance companies might not be willing to foot the bill.

Health insurers still ‘stigmatize’ substance abuse patients, one doctor says

Jorandby said health insurers tell Lakeview patients on a weekly basis that they have to leave the treatment center because the companies will not pay for the services. That means doctors have to fight for coverage and continuing treatment, she said, adding, “We are going to the mat every day.”

Laws over the years, including the Affordable Care Act of 2010, required insurers to cover substance abuse in the same way they cover medical and surgical benefits.

But many health insurers “still stigmatize” substance abuse patients, Jorandby said, “by not giving the full range of services.” She said there’s still “a pervasive attitude addiction is a weakness, a moral failing. It’s just kind of baked into the insurance company model.”

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