Drug Cos. Urged Not To Apply Virus Tax Relief To Opioid Deal

Four pharmaceutical companies should not use tax relief provided under pandemic legislation to maximize the tax benefits of their $26 billion opioid epidemic settlement, the chairwoman of the House Committee on Oversight and Reform said in letters released Friday.

The pharmaceutical companies should not use the settlement to reduce their tax liabilities under a provision of the Coronavirus Aid, Relief and Economic Security Act that allows five-year net operating loss carrybacks, Rep. Carolyn Maloney, D-N.Y., said in the letters. They were sent Thursday to Johnson & Johnson, McKesson Corp., Cardinal Health Inc. and AmerisourceBergen Corp., addressing concerns that the companies could apply the net operating loss, or NOL, provision to the settlement.

While the NOL provision was intended to help companies suffering during the novel coronavirus pandemic, Cardinal Health indicated in a report with the U.S. Securities and Exchange Commission that it would use the provision to reduce its tax liabilities by carrying back the opioid settlement. That company should reverse course, while the others should provide information proving their commitment to not applying the NOL provision to their opioid settlement, the letters said.

--Additional reporting by Emily Field. Editing by Vincent Sherry. 

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