Mallinckrodt Will Pay up to $1.1 Billion Nationwide to Settle Opioid Claims
AG James Secures More Than $1.5 Billion Total from Opioid
Manufacturers and Distributors to Combat Opioid Crisis
NEW YORK – New York Attorney General Letitia James today announced that her office secured up to $58.5 million from one of the largest drug manufacturers of opioids in the country, Mallinckrodt plc (Mallinckrodt), for its role in fueling the opioid crisis. Mallinckrodt used deceptive and misleading marketing tactics to encourage use of its highly addictive opioids that harmed communities across the country. Mallinckrodt entered into bankruptcy proceedings shortly after Attorney General James filed a lawsuit against the company in March 2019. Today’s agreement resolves those claims and raises the total amount secured by Attorney General James from opioid manufacturers and distributors to more than $1.5 billion to combat the opioid crisis.
This is the second agreement that Attorney General James has reached with Mallinckrodt related to harm it caused New Yorkers. Earlier, Attorney General James announced that Mallinckrodt would pay $26.8 million for Medicaid fraud.
“For years, Mallinckrodt pumped millions of addictive and harmful opioid pills into communities, and today they are being held accountable for the harm they caused,” said Attorney General James. “As Mallinckrodt grew its profits from its opioid business year over year, New York’s public health crisis worsened, addictions grew, and lives were lost. This agreement can’t reverse the devastation, but the $1.5 billion in funds we have already recovered for New York will help us combat the opioid crisis that these companies helped create and get us closer to ending this public health crisis.”
In 2019, Attorney General James filed a landmark lawsuit against opioid distributors and manufacturers, including Mallinckrodt, for their role in the opioid epidemic. In her lawsuit, Attorney General James detailed Mallinckrodt’s egregious conduct that caused widespread harm. Shortly after, Mallinckrodt entered into bankruptcy proceedings, because of an onslaught of lawsuits against the company. Mallinckrodt emerged from bankruptcy proceedings today and will have 18 months to determine whether it will prepay claims worth approximately $41.1 million or pay the state $58.5 million over eight years for fueling the opioid crisis.
New York was instrumental in negotiations with Mallinckrodt prior to its bankruptcy filing and during the bankruptcy process, resulting in significant economic recovery, robust injunctive relief with a monitor, and a historic commitment by the company to make its internal documents related to its opioids business available to the public.
As part of today’s agreement, Mallinckrodt is funding a repository with the company’s records to make public the role it led in the opioid epidemic. Thus far, 1.4 million documents have been released.
Mallinckrodt is one of five drug manufacturers to settle claims made by Attorney General James against the companies for their role in the opioid epidemic. The manufacturers named in the complaint included Purdue Pharma and its affiliates, as well as members of the Sackler Family (owners of Purdue) and trusts they control; Janssen Pharmaceuticals and its affiliates (including its parent company Johnson & Johnson); Mallinckrodt LLC and its affiliates; Endo Health Solutions and its affiliates; Teva Pharmaceuticals USA, Inc. and its affiliates; and Allergan Finance, LLC and its affiliates. The distributors named in the complaint were McKesson Corporation, Cardinal Health Inc., Amerisource Bergen Drug Corporation, and Rochester Drug Cooperative Inc.
Late last year, Attorney General James won an opioid trial against Teva Pharmaceuticals USA. In December 2021, Attorney General James reached a $200 million agreement with Allergan. In September 2021, Attorney General James secured $50 million from Endo to combat the opioid crisis. In July 2021, McKesson, Cardinal Health, and Amerisource Bergen agreed to pay $1 billion to New York for their role in the opioid epidemic. In June 2021, Attorney General James announced a $230 million settlement that ended Johnson & Johnson’s sale of opioids nationwide.
Pursuant to the opioid settlement fund, all funds collected by the state from opioid settlements or litigation victories will be allocated specifically for abatement efforts in communities devastated by the opioid epidemic and will not go towards the state’s general fund.
This matter was led by Senior Advisor and Special Counsel M. Umair Khan and overseen by First Deputy Attorney General Jennifer Levy. The settlement was also brought about by the work of Senior Enforcement Counsel John Oleske and Special Counsel Monica Hanna, as well as Assistant Attorneys General Conor Duffy, Carol Hunt, Diane Johnston, Leo O’Toole, Jeremy Pfetsch, Noah Popp, Michael Reisman, and Lois Saldana; Project Attorneys Wil Handley, Stephanie Torre, and Eve Woodin; Paralegal Ketty Dautruche; Legal Assistant David Payne; Director of Research and Analytics Jonathan Werberg; Data Scientist Gautam Sisodia; Data Analyst Anushua Choudhury; Information Technology Specialists Hewson Chen and Paige Podolny; E-Discovery Document Review Specialist Kristin Petrella; and former Counsel for Opioids and Impact Litigation David Nachman.