The city of Baltimore won $266 million in its lawsuit accusing top drug distributors McKesson (NYSE: MCK) and Cencora (NYSE: COR) of fueling an epidemic of opioid addiction in the U.S. and is expected to seek billions more in the next phase of the case.
A six-person jury in the Circuit Court for Baltimore found McKesson responsible for $192 million and Cencora for $74 million on Tuesday following a nearly two-month trial. The amount represents damages compensating the city for harms the companies were found to have caused.
Baltimore, which has been hit hard by the opioid crisis, opted out of large national opioid settlements in recent years in the hope of winning more money on its own. In 2022, Baltimore recorded 904 opioid overdose deaths, out of a total population of about 569,000, while the national opioid overdose death rate was about 25 per 100,000.
Next month, the city is expected to ask Judge Lawrence Fletcher-Hill for about $9 billion from the companies to pay for the cost of addressing the opioid crisis going forward. That is a legal remedy known as abatement and is distinct from civil damages.
Baltimore accuses Cencora (NYSE: COR), formerly called AmerisourceBergen, and McKesson (NYSE: MCK) of ignoring red flags that opioids they supplied were being diverted into illegal channels. The companies deny the claim.
“Justice was done,” said Bill Carmody, a lawyer for Baltimore. “The jury’s verdict is an important step toward helping Baltimore recover so that it can continue to be one of the best cities in America and a place where all of its citizens can be healthy and succeed.”
Both companies said they would seek to have the verdict overturned. In a statement, McKesson said that the verdict “fundamentally misunderstands McKesson’s limited role as a pharmaceutical distributor.”
Cencora said it “frays the legal and ethical tightrope the company is being asked to walk between providing access to necessary medications and acting to prevent diversion of controlled substances.”
Baltimore is one of more than 3,000 local, Native American tribal, and state governments across the country that have filed similar lawsuits against drugmakers, distributors, and pharmacies over the opioid crisis. The vast majority of those cases have been settled through nationwide agreements, which now total about $46 billion.
With Tuesday’s verdict, which comes after a series of settlements with other companies including Walgreens (NASDAQ: WBA) and Johnson & Johnson (NYSE: JNJ), Baltimore has now obtained more than $668 million in verdicts and settlements.
McKesson supplied about half of Baltimore’s opioids between 2006 and 2019, according to U.S. government data. In 2017, it reached a $150 million settlement with the U.S. Department of Justice, under which it admitted that it had failed in its duty to prevent illegal drug sales nationwide.
Cencora is also currently facing a civil lawsuit by the Justice Department over its alleged role in the opioid crisis.
More than 800,000 people in the United States died of opioid overdoses from 1999 through 2023, according to data from the U.S. Centers for Disease Control and Prevention.
Cencora McKesson NYSE: COR NYSE: MCK
