A Baltimore judge on Thursday proposed slashing the $266 million verdict that the city won last year from a pair of drug distributors accused of contributing to the deadly opioid crisis, suggesting the companies pay just under $52 million or receive a new trial to determine damages.

Baltimore City Circuit Judge Lawrence Fletcher-Hill agreed with the companies, McKesson and AmerisourceBergen, that the jury’s award was too high and that jurors assigned them too much blame for the crisis.

“The court finds that the verdict rendered is grossly excessive in light of the evidence and is shocking to the court,” Fletcher-Hill wrote.

The long-awaited decision is a blow to Baltimore’s legal strategy of trying to hold opioid companies financially accountable for the costs of the addiction and overdose epidemic, though the city will still get to keep the more than $400 million it won in settlements from companies that chose to strike a deal rather than risk a trial.

In recent years, Baltimore has experienced the highest rate of overdose deaths of any major city in America, according to a series of articles on the scope of the issue in The Baltimore Banner and The New York Times last year.

Thursday’s 96-page ruling is complex, but boils down to Fletcher-Hill’s finding that the jury verdict was too high. He ruled that the city can either agree to a reduced verdict of $51.8 million, or to a new trial to determine damages. If the city accepts the lower amount, McKesson will be required to pay $37.4 million and AmerisourceBergen would pay $14.4 million, in accordance with how the jury assigned responsibility to the two companies.

In a statement, Baltimore Mayor Brandon Scott said the decision was “disappointing to say the least.” The city is evaluating all of its options, he said.

“As the only municipality in the country to secure verdicts against these two companies, which were responsible for the bulk of the opioids flooding into Baltimore, we will continue to fight — just as we have fought for our city every step of the way through this litigation process," Scott said.

In an email, a McKesson spokesperson said, “We appreciate the court’s consideration of our motions and are carefully reviewing today’s opinion.”

A spokesperson for AmerisourceBergen also said the company is reviewing the judge’s decision and evaluating next steps.

Councilman Mark Conway, chairman of the City Council’s Public Safety Committee, called the judge’s decision “shocking” and “sobering.” A reduction in the award was never discussed as a possibility, he said.

“I think we were expecting a lot more support from this,” Conway said, “And to have money taken away is a pretty big blow for the city.”

Conway said he was particularly concerned by the reduction with federal funding cuts on the horizon.

“I can’t lie to say we weren’t hoping this could help us brace for the impact of some of those federal cuts,” he said.

A sophomore councilman, Conway has several times attempted to schedule public hearings on the opioid crisis, only to have his efforts thwarted by the Scott administration, which argued public discussion could jeopardize the legal proceedings. Now that the process is nearing a disappointing conclusion, Conway said he was unsure what the council’s next steps should be.

Fletcher-Hill’s ruling comes as a surprise in part because the city expected to receive more money, not lose ground. After the jury trial ended, the city requested an additional $5 billion for abatement, which is designed to relieve Baltimore’s opioid crisis going forward, rather than covering past costs.

The city put forth a comprehensive abatement plan laying out its wish list for opioid remediation. If fully implemented, the city’s experts estimated, the plan would avert more than 6,000 fatal overdoses over the next 15 years and more than triple the rate at which Baltimore residents receive medical treatment for opioid use disorder.

The plan covered a wide array of services, ranging from harm reduction, treatment, and wraparound services designed to provide people in treatment with adequate transportation, nutrition, housing and other essential needs.

The drug companies argued that they should not be responsible for those downstream costs.

On Thursday, Fletcher-Hill said he would hold off on an abatement ruling because of the possibility of a new trial. He cautioned, though, that he was inclined to adopt a more slimmed-down version of the abatement plan than the city wanted, with a focus on programs that are already operating.

“The court most likely will focus on much narrower measures to increase harm reduction steps and to reach more individuals suffering from opioid use disorder to connect them with existing treatment resources,” he wrote.

Bakari Atiba, director of community engagement for Charm City Care Connection, a Baltimore nonprofit that serves people who use drugs, said the judge’s decision was disheartening.

“In light of all the trauma and death and harm that’s been done, I’d expect the judge to have more compassion and rule in a more favorable way,” he said, adding, “It definitely means there will be less resources to spread out.”

But he remained hopeful that organizations in the city will find a way forward, no matter what comes next, because they had been working to reduce overdoses long before the city had been awarded any money from the lawsuit.

“We’ll continue to collaborate and find ways to get necessary resources to people who need it the most,” Atiba said.

Fletcher-Hill appeared skeptical of the city’s arguments throughout the trial and the abatement phase of the case. Not long before the abatement phase of Baltimore’s opioid trial began, the Ohio Supreme Court threw out a $650 million abatement award against national pharmacy chains, raising new questions about how Fletcher-Hill would rule.

But Thursday’s opinion focused on the jury trial instead of abatement. In the fall, a jury of city residents found McKesson and AmerisourceBergen were responsible for 97% of the city’s opioid epidemic and awarded Baltimore $266 million in damages.

The city’s lawsuit focused on a small group of pharmacies, where the city argued the drug distributors should have seen clear red flags for opioid diversion. Together, the two drug distributors provided the majority of the half a billion opioids that were sent to Baltimore and Baltimore County between 2006 and 2019, according to federal drug dispensing data.

The companies argued after the trial that it was “plainly illogical” that they, on their own, could have been responsible for almost the entirety of the opioid crisis in Baltimore. They asked Fletcher-Hill to overrule the jury’s verdict, reduce the amount awarded or call a new trial.

Fletcher-Hill agreed Thursday, finding that the verdict was not supported by the city’s evidence at trial. He pointed to evidence that “medicine cabinet diversion,” in which properly prescribed opioids are misused by someone other than the person prescribed them, accounted for a significant portion of the opioid crisis and could not be blamed on drug companies.

The judge also said that pharmacies and illegal drug traffickers bear some responsibility that was not considered in the jury’s verdict. He reduced the jury’s award to account for each of these factors.

“Although the Court may grant a new trial based on its assessment of the weight of the evidence, the evidence on these issues actually meets the more stringent standards that no reasonable juror could conclude that Defendants are responsible for 97% of the misuse of prescription opioids in Baltimore,” he wrote.

Baltimore’s legal strategy in this case was a bold one. Only a tiny fraction of states and local governments have taken their opioid cases to trial, and Baltimore previously declined to participate in a massive “global” settlement with drug companies in hopes of winning more money. Even with Thursday’s ruling, the city still won more by pursuing a trial and settling with many companies individually than it would have received through the broader settlement.

Money that the city received through settlements and the jury verdict, whatever it ends up being, will be held in a trust to be spent slowly over 15 years. Distribution of the funds is being overseen by a Restitution Advisory Board, which will make spending recommendations, and an “Overdose Cabinet,” which will review the recommendations before the mayor makes a final decision.

Baltimore already moved forward with plans to spend a portion of its award from the opioid litigation based on the publicly stated expectation that it may grow, not shrink.

Mayor Brandon Scott’s proposed budget for the coming year includes $36 million from the newly established Opioid Restitution Fund — $17.4 million from settlement money and the remainder from the larger pot of funds.

Community organizations have also raised concerns that they may only be able to access a fraction of the opioid money in the upcoming year. Much of the opioid restitution fund money in the city’s preliminary budget has already been set aside for city agencies and community groups that were named in settlement agreements with drug companies.

Katie Rodriguez, who consults for groups that help people who use drugs, called harm reduction organizations, said their limited resources have been further strained by federal funding cuts.

Slashing the city’s opioid restitution funds “will be gutting for some programs to know that stability they have been pushing towards may no longer exist,” she said.

The legal arguments about how much responsibility each of the companies bore seemed like “splitting hairs” in the wider context of the overdose crisis, she said.

“I wish the judge had to say it directly to families who had lost loved ones to opioid overdose,” she said.

Baltimore Banner reporter Emily Opilo contributed to this article.