Drugmaker Hikma, Ad Firm Publicis Agree to Pay $500 Million to Settle US Opioid Cases

By Jace Dela Cruz

Feb 02, 2024 04:27 AM EST

A division of French ad firm Publicis Groupe SA and drugmaker Hikma Pharmaceuticals have reached separate settlements totaling $500 million to resolve allegations that they helped fuel the deadly opioid epidemic in the United States (US).

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NEW YORK, NEW YORK - JUNE 05: Some of the items are displayed in a new vending machine in Brooklyn that will disperse fentanyl test strips and naloxone as well as hygiene kits, maxi pads, Vitamin C, and COVID-19 tests for free on June 05, 2023 in New York City.

Publicis, Hikma Settle US Opioid Cases

According to Reuters, the settlements, which were announced on Thursday by US state attorneys general, are now part of the over $50 billion that various players in the pharmaceutical supply chain have agreed to pay to settle lawsuits and probes over their alleged roles in the opioid addiction crisis.

Publicis Health, a division of Publicis Groupe, is paying $350 million to resolve claims by all US states and territories that it helped OxyContin manufacturer Purdue Pharma increase its sales of its prescription opioid painkiller through marketing strategies it drew up.

Massachusetts sued Publicis in 2021. The state accused the company of collecting over $50 million to help Purdue get doctors who will prescribe its opioids to many patients for higher doses and a longer period.

Massachusetts served on the executive committee of states investigating the firm. In a statement, Massachusetts Attorney General Andrea Joy Campbell said the settlement would "bolster accountability and transparency for this ongoing crisis, with the state using the $8 million to fund treatment and services.

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Publicis and Hikma Denies Allegations

Publicis has denied Massachusetts' allegations as it appeals to junk the case. However, a state court judge declined to dismiss the lawsuit in October 2021.

Of the $350 million settlement, Publicis said $343 million would go to the opioid relief effort of the states, and the rest was for legal fees. To cover the settlement, the company recorded a pre-tax charge of $213 million for 2023's fourth quarter after being paid $130 million by its insurers.

London-listed Hikma separately agreed to pay $150 million to resolve allegations by states and localities. The $150 million will consist of $115 million in cash and $35 million worth of naloxone, an opioid addiction treatment medication.

Hikma has also denied any wrongdoing. The company had been facing over 900 lawsuits stemming from the opioid addiction epidemic. The settlement reportedly resolves allegations that Hikma failed to monitor suspicious orders of opioids from potentially illegal distributors from 2006 to 2021.

In a statement, Hikma said the agreement would resolve the "vast majority" of cases against the company. According to Campbell's office, states under the settlement that do not accept the naloxone medication will receive cash instead.

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