After an Oklahoma judge ruled against Johnsons and Johnsons on the opioid crisis case versus the company and imposed fines that are less than what investors are expecting, J&J stocks spiked up 2% in Tuesday’s post-market trading after the verdict was read.
Investors are expecting J&J to be fined between $500 million and $5 billion, reports revealed. However, the court only imposed a fine of $572 million.
Calling the opioid crisis an “imminent danger and menace,” District Judge Thad Balkman said, “the state met its burden that the defendants Janssen and Johnson & Johnson’s misleading marketing and promotion of opioids created a nuisance as defined by [the law],” highlighting that the opioid crisis has put the health of Oklahomans at risk.
“Specifically, defendants caused an opioid crisis that’s evidenced by increased rates of addiction, overdose deaths, and neonatal abstinence syndrome,” he added.
J&J said that they would file an appeal against the decision.
The case revolves around the allegations that J&J and its subsidiary company, Janssen, downplayed the risks of addiction to opioids. The suit alleges that the companies are training their sales representative to disclose to physicians that the risk was 2.6% or less if the drugs were prescribed by a doctor, leading doctors to prescribe huge amounts to their patients.
The fine that is to be paid by the company will be used by the state to fight against the effects of the opioid crisis for the first year. While the attorney general’s office has presented several expert witnesses that the rehabilitation program would be more likely to take more than 20 years, the court disagreed and said that there is no enough evidence to back this claim.
The state did not present sufficient evidence of the amount of time and costs necessary, beyond year one, to abate the opioid crisis,” the ruling says.