Adds additional background in paragraphs 2-3 and 6-8, statement from New York Attorney General in paragraph 4

April 7 (Reuters) - Viatris VTRS.O said on Monday it would pay up to $335 million over nine years as part of a nationwide settlement to resolve claims by U.S. state and local governments that it fueled an epidemic of opioid addiction.

The Pennsylvania-based company, formed by the merger of Mylan and Pfizer's PFE.N Upjohn business in 2020, did not admit wrongdoing as part of the agreement.

It said it would pay between $27.5 million and $40 million annually toward state and local opioid initiatives as part of the settlement.

"When drug companies put profits over people, innocent patients can get sucked into deadly cycles of addiction and overdoses," New York Attorney General Letitia James, one of the leaders in negotiating the settlement, said in a statement. "While no settlement can fully repair the damage caused by dangerous opioids, these funds will help New York and other states fight the opioid crisis."

The company sells opioid products in the form of its painkiller Ultiva and the Fentanyl Transdermal System, which is a generic version of Johnson & Johnson's JNJ.N branded fentanyl patch product, Duragesic.

Viatris is one of numerous drugmakers accused by state and local governments of downplaying opioid drugs' risks.

The long-running opioid litigation, which also includes claims that distributors and pharmacies ignored red flags that drugs were being distributed illegally, has already resulted in more than $50 billion in settlements.

Most recently, Purdue Pharma and its Sackler family owners in January reached a $7.4 billion settlement to resolve thousands of lawsuits over their pain medication OxyContin, which is widely blamed for helping spark the crisis.

Opioid-related overdoses claimed more than 80,000 lives in 2023 and has led to 700,000 deaths over the past two decades, according to the Centers for Disease Control and Prevention.

(Reporting by Christy Santhosh in Bengaluru and Brendan Pierson in New York; Editing by Tasim Zahid, Shilpi Majumdar and Chizu Nomiyama)

((Christy.Santhosh@thomsonreuters.com))