Moody's: Purdue settlement 'no more than a stopgap'
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Purdue Pharma's Stamford, Conn., headquarters
The roughly $10 billion opioid settlement that 24 states agreed to this month with Purdue Pharma represents "no more than a stopgap for local and state governments," which will continue to face opioid crisis costs that far exceed the settlement amounts, according to a new report from Moody's Investors Service.
Seen as a way to address rising government costs and losses of revenue attributable to the crisis, "the Purdue payoff is unlikely to reverse the economic and social woes related to high levels of opioid addiction for the forseeable future," credit analysts wrote in a report released Monday, noting there are outstanding complaints pending against multiple other prescription opioid makers and pharmaceutical companies.
Using data in 800 counties rated by Moody's, analysts said those with the highest drug overdose rates have, on average, endured much slower tax base growth and cited a wide range of estimates of the costs of opioid abuse.
"Researchers from the Centers for Disease Control and Prevention estimate the total economic costs at $78 billion, $7.7 billion of which is tied to criminal justice-related public services and $2.8 billion for addiction treatment," Moody's reported. "Separately, a July article in the American Journal for Managed Care asserts that states’ annual opioid-related costs in the Medicaid program alone are over $8 billion." Those estimates date back to 2013, the report said, and annual opioid deaths have nearly doubled since then.
Massachusetts is among the states that opted against participating in the settlement and Attorney General Maura Healey is pursing relief in Purdue Pharma's federal bankruptcy case in New York.
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