The drug industry will go on trial in federal court on Monday, as a jury begins to hear claims by thousands of American communities that pharmaceutical firms collaborated in a conspiracy that drove the US opioid epidemic.

The case in Cleveland is the first of a series of trials meant to establish whether opioid makers, drug distributors and pharmacy chains are liable to pay out billions of dollars to thousands of counties, cities and Native American tribes blighted by an epidemic that has claimed more than 400,000 lives over the past two decades.

The plaintiffs are using anti-racketeering laws, originally written to go after organised crime, and allegations of creating a public nuisance to claim that manufacturers of narcotic painkillers aggressively drove up sales with knowingly false claims that they were less addictive and more effective than they were, leading to a huge surge in prescribing.

They also allege that distributors and pharmacies ignored legal obligations to restrict delivery and dispensing of the drugs even as the death toll escalated, because they were making so much money.

“The facts will show that opioid makers and distributors conspired to create and benefit from the worst public health crisis in decades,” the lead lawyers for the plaintiffs said in a statement.

Among companies in the dock are Teva Pharmaceuticals, the world’s largest manufacturer of generic drugs, and the US’s second-largest pharmacy chain, Walgreens. Three major drug distributors are also on trial, including McKesson and AmerisourceBergen, both among the top 10 revenue generating companies in the US.

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The companies have all denied responsibility.

Monday’s trial concerns lawsuits brought by two Ohio counties, Cuyahoga and Summit. If the jury finds the firms are liable and awards damages, the verdict would be put together with other trials in coming months in deciding a comprehensive settlement to cover plaintiffs across the country.

Last-minute negotiations to forestall the trial by negotiating an overall settlement of about $50bn collapsed on Friday, in part due to divisions between local governments and several state attorneys general over whether the funds were sufficient to meet the cost of the crisis and who would control them.

A new study has found that the epidemic has cost the US more than $800bn in the last four years alone. The Society of Actuaries said the costs ranged from increased health and social care spending to loss of earnings by people who have died and pressure on the criminal justice system.

The collapse of the talks was welcomed by advocates who not only want a much larger settlement but also want to see the drug industry exposed at trial. Pharmaceutical companies are pressing for internal documents revealing their decisions and actions to remain secret as part of any settlement.

“We need hundreds of billions of dollars to deal with this crisis,” said Emily Walden, chair of the Fed Up coalition of families hit by the epidemic and doctors who have spoken out against the wide prescribing of opioids. “The settlement talks are not holding these companies accountable for what they’ve done. $50bn is pocket change to them.”

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Several major opioid manufacturers settled the Ohio case in recent weeks, including Johnson & Johnson which lost a major trial in an Oklahoma state court in August when a judge found the company’s drive to sell opioids with false claims caused addiction and death.

Opioid makers and distributors have already paid out hundreds of millions of dollars to settle federal cases accusing them of failing to obey laws about cutting off deliveries to pharmacies dispensing suspiciously large amounts of prescription painkillers. But the companies made no admission of liability in paying the settlements.

Walden said she wants to see the trial lead to the prosecution of executives responsible for marketing and other strategies that boosted opioid sales.

“It’s pretty clear what happened and what they’ve done,” she said. “We need some accountability and it needs to lead to criminal charges. They’re getting away with murder. They’re buying their way out. They think that’s the way of doing business.”

There have been some criminal prosecutions.

In July, federal prosecutors charged three top executives of the drug distributor Miami-Luken with illegally flooding parts of Appalachia with millions of opioid pills. In May, John Kapoor, the 75-year-old billionaire founder of Insys Therapeutics, was convicted for bribing doctors to prescribe a powerful opioid, Subsys, to patients who did not need it.

Separately, Purdue Pharma, maker of the powerful opioid OxyContin, which played a leading part in firing up the epidemic, is negotiating to end hundreds of lawsuits.

The company has filed for bankruptcy as part of a proposed agreement that would see it put into a trust and future profits go toward alleviating the epidemic. Members of the Sackler family who own the company would also pay from the personal fortunes they have built from the sale of OxyContin.

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But the deal is opposed by several state attorneys general who want to see the company put out of business and the Sacklers, who are estimated to have made more than $12bn from opioids, pay more money.