Endo, 36 states agree to new $450m opioid settlement

Endo is accused of boosting opioid sales using “deceptive marketing,” downplaying the risk of addiction and overstating the benefits. It’s unclear how much Rhode Island and Massachusetts would receive.

Endo’s headquarters in Malvern, Pa., on Tuesday, June 28, 2022.Mark Makela/NYT

PROVIDENCE — Opioid maker Endo International and its lenders reached a settlement with 36 states in its bankruptcy filings, Rhode Island Attorney General Peter F. Neronha announced Thursday. In all, the plan could provide a total of up to $450 million to participating states.

The agreement with Endo, a Dublin-based company that announced it filed for chapter 11 protection in New York on Tuesday, comes after the company faced mounting lawsuits, accusing it of fueling the opioid crisis through the promotion of its painkiller Opana ER. Endo was accused of boosting opioid sales using “deceptive marketing,” which downplayed the risk of addiction and overstated the benefits, Neronha’s office said.

Several states also alleged that Endo falsely promoted the benefits of Opana ER’s so-called “abuse-deterrent formulation.” Neronha said this “formula” did “nothing to deter oral abuse,” but instead led to deadly outbreaks of Hepatitis and HIV due to its widespread abuse via injection.

The agreement, which is contingent on the bankruptcy court’s approval, says Endo will be required to make payments of $450 million in cash over 10 years to participating states. Endo will have to turn over its opioid-related documents so that they are published online in a public document archive — another $2.75 million fee for archival expenses, Neronha said.

The settlement also bans the marketing of all opioids made by Endo “forever.”

Rhode Island Attorney General Peter F. Neronha speaks during a press conference.Matthew Healey for The Boston Globe

It’s unclear how much Rhode Island’s share of the settlement would be worth. Rhode Island and the other 35 states’ shares will be determined “once documents are finalized and court approvals are obtained,” Brian Hodge, a spokesman in Neronha’s office, told the Globe.

Endo, which has its U.S. headquarters in Pennsylvania, also makes generic and branded opioids like Percocet and Endocet.

“This office continues to pursue opioid manufacturers, distributors, and consultants all with a singular goal in mind: hold those companies accountable for deceptively peddling highly addictive narcotics to Rhode Islanders,” said Neronha in a statement. “What today’s settlement means is that additional money will come to our state to support opioid abatement efforts.”

Prior to this settlement with Endo, Neronha — the state’s top prosecutor — has secured more than $220 million from previous opioid litigation and settlements, including $90.8 million from pharmaceutical distributors McKesson, Cardinal Health, and AmerisourceBergen over 18 years. The dollars are then administered to help fund life-saving medication for Rhode Island’s opioid prevention, treatment, and recovery efforts.

“These resources are in the process of being delivered and distributed for opioid prevention, treatment, and recovery,” said Neronha, who previously told the Globe that he has met with survivors and loved ones of those impacted by the opioid crisis in preparation for these suits. “This is only the beginning, and more work remains to right the wrongs in our community, and this office is committed to the task.”

In 2017, Endo pulled Opana from the market at the request of the U.S. Food and Drug Administration. The drug, which is oxymorphone hydrochloride, was first approved by the Food and Drug Administration in 2006 for “moderate-to-severe pain.” The company had replaced the original formula of Opana ER with a new formula that was intended to make the drug “resistant to physical and chemical manipulation” for abuse by snorting or injecting it. It met regulatory standards for approval at the time, but the FDA later found that data did not show that the new formula was actually reducing abuse.

In a statement announcing their chapter 11 proceedings, Endo’s president and CEO Blaise Coleman said the bankruptcy filing process will “enable us to continue our ongoing business transformation, including investing in our core areas of growth, as we work to execute a transaction to strengthen our balance sheet and secure a strong tomorrow.”

In a letter to stakeholders, Coleman, who previously worked for pharmaceutical companies AstraZeneca and Johnson & Johnson, wrote the restructuring process would “substantially reduce our debt and address opioid-related and other claims without the need for continued costly, time-consuming litigation.”

Each state in New England joined the settlement, but Massachusetts, Maine, Vermont, and New Hampshire are among the seven states that led negotiations.

“Endo’s deceptive marketing fueled the opioid crisis and caused a massive human toll,” said Massachusetts Attorney General Maura T. Healey in a statement.