Senior Oversight Committee Members Probe Four Companies on Tax Deductions for Opioid Settlements
Washington, D.C. (Mar. 5, 2021)—Yesterday, Committee on Oversight and Reform Chairwoman Carolyn B. Maloney, Committee on Oversight and Reform Vice Chair Jimmy Gomez, and Committee Member Mark DeSaulnier sent letters to four companies seeking information about their plans to use a CARES Act tax provision—meant to help companies struggling during the coronavirus pandemic—to increase tax deductions for litigation costs related to the company’s role in the U.S. opioid crisis.
The Members sent the letters to Cardinal Health, McKesson Corporation, AmerisourceBergen, and Johnson & Johnson. If taken, the tax deduction would be contrary to congressional intent to help small and ailing businesses hurt by the coronavirus pandemic.
“It would be wrong for you to deduct opioid settlement payments under a CARES Act provision intended to assist businesses that are struggling during the coronavirus pandemic. The American people should not be on the hook for hundreds of millions of dollars for your company’s role in fueling the opioid crisis. Any attempt to reduce your settlement costs by taking advantage of a tax provision intended for businesses suffering coronavirus-related losses is an insult to every community suffering from the opioid crisis and the pandemic,” wrote the Members.
Distributors McKesson, Cardinal Health, and AmerisourceBergen and manufacturer Johnson & Johnson have reportedly agreed to pay a combined $26 billion to settle claims from dozens of states and local jurisdictions regarding their roles in the opioid crisis. Under the terms of this proposed settlement, this money would reimburse communities for the costs of the opioid crisis.
The letters seek information from the companies about their role in the opioid crisis, including whether the companies took disciplinary actions against executives and employees involved in the conduct the companies now seek to settle. The Members also called on the companies to commit to disclosing publicly the relevant internal documents that underlie the proposed settlement, a requirement in other similar settlements.
Click here to read the letter to Cardinal Health Incorporated.
Click here to read the letter to McKesson Corporation.
Click here to read the letter to AmerisourceBergen Corporation.
Click here to read the letter to Johnson & Johnson.