Teva and Johnson & Johnson are Facing Thousands of Lawsuits

The opioid makers including Teva Pharmaceutical Industries Ltd (NYSE:TEVA) and Johnson & Johnson (NYSE:JNJ) are facing thousands of state and local civil lawsuits, as both companies are scrambling to ink a deal to escape the multibillion dollar legal overhang. But the civil charges could be the least of the drugmakers’ concerns with the feds reportedly gearing up for a criminal probe into their opioid businesses.

The Federal prosecutors have opened a criminal investigation against both pharmaceutical companies but still the scope of investigation is not clear but at least six drug-makers and distributors which includes Mallinckrodt, J&J, Teva, Amneal, McKesson and AmerisourceBergen have acknowledged receiving the federal subpoenas in Securities and Exchange Commission filings.

Teva Pharmaceutical Industries Ltd (NYSE:TEVA) offered a whopping $23 billion “framework” deal in late October, to end lawsuits it faces with the vast majority of that settlement tied to the donations of buprenorphine naloxone, an opioid addiction treatment, in the next 10 years. The company offer also included $250 million in cash.

 

Johnson & Johnson (NYSE:JNJ) had offered $4 billion to join the Teva Pharmaceutical Industries Ltd (NYSE:TEVA)’s agreement with four state attorneys general, along with a slew of local plaintiffs. Other companies which includes McKesson, AmerisourceBergen and a third distributor Cardinal Health reportedly offered to join the settlement, for about $20 billion in cash payment.

 

The U.S. prosecutors were reportedly expected to again issue a new round of subpoenas, against more companies in the coming month, according to WSJ report.

 

And these companies would join the short list of “opioid makers” and the distributors, which are targeted by federal prosecutors, on grounds of criminal charges in nation’s opioid epidemic.

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That criminal investigation shows a significant escalation in charges against opioid industry as thousands of state and the local civil lawsuits that could be nearing resolutions.

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