Drugmaker Mallinckrodt reaches $1.6B opioid settlement

The generic drugmaker Mallinckrodt has a tentative $1.6 billion deal to settle lawsuits over its role in the U.S. opioid crisis, it announced Tuesday.

The deal is intended to end hundreds of lawsuits faced by the company over opioids.

The company said that it had an agreement with a key committee of lawyers representing thousands of local governments suing various drug industry players over opioids — and that the deal has the support of the attorneys general of 47 states and territories.

The company, based in Staines-Upon-Thames, England, was one of the highest-volume opioid producers in the U.S. at the height of the nation's prescription drug crisis, shipping 2.3 billion pills from 2006 to 2014, according to federal data.

In 2010 alone, Mallinckrodt's SpecGX subsidiary, shipped 210 million doses of oxycodone to Florida, then the epicenter of the black market opioid trade. The company's potent 30 milligram pills were especially sought after by people with addiction.

Documents gathered as the company prepared for trial showed that a Mallinckrodt sales manager told a distributor in 2009 of the pills: "Just like Doritos; keep eating, we'll make more." A company spokesman later called the statement “outrageously callous.”

The company argued in court filings that unlike makers of brand-name drugs, it did not promote opioids to doctors or understate the addiction risks. But plaintiffs in the cases said Mallinckrodt continued to ship suspicious orders without making sure the drugs weren't going to be diverted to the black market.

Under its agreement, Mallinckrodt is filing for bankruptcy. The plan calls for it to make payments for eight years after the company emerges from the protections. That route is similar to one OxyContin maker Purdue Pharma is taking to settle...