Lawmakers Question Opioid Settlement Tax Breaks

🏛️💊 The House Committee on Oversight and Reform asked the departments of Justice and the Treasury to look into the tax deductions of four pharma companies involved in a multi-billion-dollar opioid settlement.

• Last month, Johnson & Johnson, AmerisourceBergen, Cardinal Health and McKesson agreed to pay a collective $26 billion to settle claims they fueled the ongoing opioid epidemic, though none of the companies acknowledged any wrongdoing as part of the deal.
• The House committee is asking the federal agencies to investigate tax breaks ranging from $974 million to $1.4 billion that all four pharma giants are seeking to offset some of the costs of the settlement.
• Lawmakers said they're concerned these deduction plans could place an "improper burden on taxpayers."
• For their part, the pharma companies say they’ve been very upfront in their approach to seeking deductions, which they claim are permissible under federal law.

🧠 In the know: US law is uncertain about these types of tax breaks. Most firms push for settlements to include a “restitution” payment for victims, which often qualifies them for deductions.