gavel, pharmaceuticals, pills
© Francis Scialabba
Yesterday, an Oklahoma judge ruled that drugmaker Johnson & Johnson must pay $572 million to the state for its role in the opioid crisis that killed more than 47,000 Americans in 2017 alone.

The details
  • What Oklahoma said: State Attorney General Mike Hunter argued that Janssen, J&J's pharmaceutical subsidiary, created a "public nuisance" by misinforming both doctors and the public about the addictive risks of painkillers as early as the 1990s. The state called J&J the "kingpin" of the crisis.
  • What J&J said: It lawfully marketed and sold prescription opioid painkillers, and its products account for under 1% of the Oklahoma opioid market (a stat the state disputed). It's appealing the decision.
J&J could have made out much worse. Oklahoma was seeking over $17 billion, while investors penciled in a fine of up to $5 billion, per Evercore. J&J shares rose after hours given the lighter-than-expected fine. But still...

So what comes next?

The seven-week trial was the first by a state seeking compensation for an opioid-driven public health crisis.

And the entire industry was nervously watching. Oklahoma's decision to hold a pharmaceutical company accountable for contributing to the opioid crisis could set a precedent for the roughly 1,900 pending cases against J&J, Purdue, Teva, and other prominent drugmakers.
  • Some experts have suggested opioid producers could have to pay up to $100 billion to resolve their liability for the opioid crisis.
Food for thought: The "public nuisance" argument Oklahoma used is traditionally wielded in property disputes, the WSJ reports. But it was also used successfully to fight Big Tobacco in the 1990s, resulting in a $246 billion settlement in 1998.