- Opioid distributors McKesson,Cardinal Health and AmerisourceBergen tumbled more than 7% at their lows on Tuesday after a Bloomberg report said the companies offered $US10 billion to settle claims that they fuelled the nation’s drug epidemic.
- The offer was met with a $US45 billion counter from the National Association of Attorneys General, according to Bloomberg.
- Any settlement would take decades to be fully paid out, people familiar with the talks said.
- Read more on Markets Insider.
Opioid distributors McKesson,Cardinal Health, and AmerisourceBergen all fell as much as 7% at their intraday lows on Tuesday after a Bloomberg report said their $US10 billion settlement offer was met with a $US45 billion counter from the National Association of Attorneys General.
The lawsuits claim the companies helped fuel the US drug epidemic, and the NAAG is officiating talks for more than 35 states. A settlement would be used to cover costs from opioid addiction and overdoses, Bloomberg reported.
The recent developments mark the first time such a settlement has been quantified by the three companies in two years of talks. It’s not known whether the two sides can agree on a figure. The settlement – whether it more closely resembles the companies’ proposal or the states’ demands – would be paid out over decades, according to people familiar with the talks.
McKesson fell as much as 7.2% Tuesday while Cardinal Health stumbled as much as 7.6%. AmerisourceBergen dropped as much as 6.7%.
The opioid distributors also face more than 2,000 lawsuits from US cities and counties related to the opioid epidemic, according to Bloomberg. A separate team of lawyers are handling those cases.
A worldwide settlement payment for all opioid distributors and manufacturers could cost as much as $US55 billion, analysts at Nephron Research told Bloomberg. A Wells Fargo analyst estimated the final payment could come in at nearly $US100 billion.
McKesson closed at $US139 per share Tuesday. The company is up about 26% year-to-date.
Cardinal Health closed at $US42.92 per share. The company is down about 4% year-to-date.
AmerisourceBergen closed at $US84.11 per share. The company is up about 13% year-to-date.
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