Purdue Pharma, the manufacturer of the Oxycontin painkiller has agreed to pay the state of Oklahoma $270 million to settle litigation for the damage caused by the opioids. This is the first of 37 states to settle on the matter and considering the size of the settlement, Purdue Pharma, which has already seen its share price plunge by 60%, will almost certainly have to file for bankruptcy.
The settlement does not bode well for Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA). The suit being conducted by the Oklahoma Attorney General Mike Hunter includes Israel's Teva as well as Johnson & Johnson and they are not included in the out of court settlement reached with Purdue. Teva's case is likely to go to court.
Teva is exposed to the opioid crisis through its generic versions of Fentora and Actiq painkillers as well as through Anda, the fourth largest pharmaceutical distribution company in the US, which it acquired from Allegan's generics division Actavis.
Market sources believe that Teva may have to pay at least $300 million in lawsuits for its role in any opioid settlement around the US.
After falling sharply in recent days, Teva's share price rose 0.19% on the NYSE yesterday to $15.93, giving a market cap of $17.357 billion.
Published by Globes, Israel business news - en.globes.co.il - on March 27, 2019
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