States detail $26B settlement to resolve opioid lawsuits with Johnson & Johnson, drug distributors


As part of the ongoing effort to address the opioid addiction and overdose crisis in the U.S., a group of state attorneys general and the companies involved in a possible $26 billion settlement with opioid producers laid out key details of the settlement on Wednesday.

The deal calls for the drugmaker Johnson & Johnson to pay up to $5 billion, in addition to billions more from the major national drug distribution companies. AmerisourceBergen and Cardinal Health are each to contribute $6.4 billion. McKesson is to pay $7.9 billion.

States – except West Virginia, which has already settled with the companies – will have 30 days to approve the agreements. After that, local governments will have four months to sign on. Each company will decide whether enough jurisdictions agree to the deal to move ahead with it.

“While the companies strongly dispute the allegations made in these lawsuits, they believe the proposed settlement agreement and settlement process it establishes … are important steps toward achieving broad resolution of governmental opioid claims and delivering meaningful relief to communities across the United States,” the distribution companies said in a statement.

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States detail $26B settlement to resolve opioid lawsuits with Johnson & Johnson, drug distributors

Connecticut Attorney General William Tong said it would be the second-biggest cash settlement of its kind U.S. history behind the tobacco deal in the 1990s.

North Carolina Attorney General Josh Stein said the opioid agreement requires state and local governments to use the vast majority of the money on abatement – and that will be subject to a court order. Stein said there’s a strong will to comply because of the devastation from opioids.

“We all are experiencing the consequences in communities across North Carolina, across the country,” Stein said at a video news conference Wednesday.

Prescription drugs and illegal ones like heroin and illicitly produced fentanyl have been linked to more than 500,000 deaths in the U.S. since 2000. The number of cases reached a record high in 2020.

If approved, the settlement will likely be the largest of many in the opioid litigation playing out nationwide. It’s expected to bring more than $23 billion to abatement and mitigation efforts to help get treatment for people who are addicted along with other programs to address the crisis. The money would come in 18 annual payments, with the biggest amounts in the next several years.

States detail $26B settlement to resolve opioid lawsuits with Johnson & Johnson, drug distributors

A group of advocacy organizations, public health experts and others are pushing for governments to sign on to a set of principles for how settlement money should be used. They include establishing a dedicated fund for combating the epidemic with the settlement money and making sure that it doesn’t just replace other funding streams in the budget.

The group has pointed out that many state and local governments have already made cuts to substance use and behavioral health programs because of economic downturn wrought by the coronavirus pandemic. And government officials may be tempted to fill holes in budgets with the money.

Joshua Sharfstein, a vice dean at the Johns Hopkins Bloomberg School of Public Health, said it’s crucial that the money is spent to combat the opioid scourge because the overdose epidemic is raging.

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Last year, there were a record 93,000 fatal overdoses from all drugs in the U.S. The majority of them involved fentanyl, a potent synthetic opioid that has medical uses but is also produced illicitly.

“Everybody is both excited and a little worried,” Sharfstein said of the expected funds, “a little worried that they may be squandered.”

Another concern is that some government officials have been too busy dealing with the coronavirus to fully consider where the settlement funds should go.

“I’m afraid that in some places, there just may not be a lot of attention (paid to it), and it could get put back into the general fund,” said Marcus Plescia, chief medical officer for the Association of State and Territorial Health Officials. “It’s not that there aren’t some people out there doing it. But leadership is having a hard time engaging in this because they’re so caught up in the pandemic.”

Bradley D. Stein, director of the RAND Corporation’s Opioid Policy Center, said it’s important to spend the money on efforts that are proven to be effective, including treating addictions and using drugs to stop overdoses.

“We know treatment works,” he said. “We know naloxone appears to be very important in preventing overdose deaths. … There’s not going to be a silver bullet. It may vary, community by community.”

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