Teva Pharmaceuticals (NYSE:TEVA) stock is soaring higher on Wednesday after the pharmaceutical company reached a settlement in recent lawsuits.
According to recent reports, Teva Pharmaceuticals is prepared to pay a proposed $4.35 billion to settle lawsuits connected to the opioid crisis in the U.S. That covers $3.7 billion in cash to local governments, $1.2 billion worth of opioid overdose treatment naloxone, as well as other payments.
Before that settlement is agreed on, Allergan must first reach its own nationwide settlement over the lawsuits. Teva Pharmaceuticals and Allergan also have to come to an agreement over their own disagreements over cases prior to 2016. That’s when TEVA acquired its generic drug business.
It’s worth pointing out that the proposed settlement payment is much higher than the $2.6 billion that Teva Pharmaceuticals was expecting to pay. Also, the company has to wait for enough local governments to accept the terms of the settlement before the $4.35 billion number is finalized, reports Reuters.
Despite the settlement payment being higher than expected, shares of TEVA stock are rising alongside heavy trading today. As of this writing, more than 33 million shares of the stock have changed hands. That’s more than triple the company’s daily average trading volume of about 10.9 million shares.
TEVA stock is up 24.4% as of Wednesday morning, which brings its year-to-date gains to 6.2%.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.