NASHVILLE, Tenn. (WATE) — An Israel-based drug manufacturer reached a settlement of over $4 billion in a lawsuit for their alleged role in the opioid crisis in the United States, according to Attorney General Herbert H. Slatery III.

The preliminary agreement of the settlement is still within the subject of ongoing negotiations. The $4.25 billion will go to participating states and local government.

“This settlement is another major step in holding opioid manufacturers accountable and we expect these funds to make a significant difference in treating opioid addiction disorder in Tennessee and across the country,” Slatery said. “One problem we encountered with Teva (as we have with other manufacturers) is the advice it gave when opioids were losing their effectiveness for clearly addicted patients – just up the dosage. I don’t have enough adjectives to describe how poor that advice was.”

Teva makes Actiq and Fentora, branded fentanyl products for cancer pain, and a number of generic opioids, including oxycodone.

The states were alleging that Teva:

  • Promoted potent, rapid-onset fentanyl products for use by non-cancer patients;
  • Deceptively marketed opioids by downplaying the risk of addiction and overstating their benefits, including encouraging the idea that signs of addiction are actually “pseudoaddiction” treated by prescribing more opioids.
  • Failed to comply with suspicious order monitoring requirements along with its distributor, Anda.

The parties are agreeing to the following financial terms:

  • Teva will pay a maximum of $4.25 billion in cash over 13 years. This figure includes amounts Teva has already agreed to pay under settlements with individual States, funds for participating States and subdivisions, and the $240 million of cash in lieu of product described below.
  • A part of the financial terms, Teva will provide up to $1.2 billion in generic naloxone (valued at Wholesale Acquisition Cost or WAC) over a 10-year period or $240 million of cash in lieu of product, at each State’s election. Naloxone is used to counteract overdoses.
  • The settlement will build on the existing framework that states and subdivisions have created through other recent opioid settlements.

A final settlement remains contingent on agreement on critical business practice changes and transparency requirements, according to the news release.

The negotiations are being led by Tennessee, and other states, including California, Illinois, Iowa, Massachusetts, New York, North Carolina, Pennsylvania, Texas, Vermont, Virginia, and Wisconsin.