Teva agrees $4.25 billion opioids settlement

Shares of Israeli generics giant Teva Pharmaceutical Industries (NYSE: TEVA) were up 14.7% at 2,856 shekels this morning, as it announced it has reached an agreement in principle with the working group of US States’ Attorneys General, counsel for Native American Tribes, and plaintiffs’ lawyers representing the States and subdivisions, on the primary financial terms of a nationwide opioids settlement.

Teva will pay up to $4.25 billion (including the already settled cases) plus approximately $100 million for the Tribes, spread over 13 years.

The figure above includes the supply of up to $1.2 billion (wholesale acquisition cost (WAC)) of its generic version of the life-saving medication, Narcan (naloxone hydrochloride nasal spray) - which can reverse an overdose from opioids - over 10 years, or cash at 20% of WAC ($240 million) in lieu of product. The agreement provides the option for a significant supply of Narcan to provide access across the nation to help combat the opioid epidemic.