By Bailey Pierce and Dakota Thomas
In late July, a bipartisan group of attorneys general and local government lawyers from 13 states endorsed a multi-billion-dollar settlement against major drug companies that would end several open civil lawsuits stemming from opioid distribution. The agreement would require three drug distributors and one drug maker to make $26 billion in payments to states and communities to provide, among other things, addition rehabilitation and prevention services.
Over the last several years, drug firms have faced a barrage of lawsuits for their alleged roles in encouraging the distribution and sale of opioids across the country at a time when drug addiction and opioid overdoses are on the rise. If the settlement is approved by the named states and municipalities — including California, Colorado, Connecticut, Delaware, Florida, Georgia, Louisiana, Massachusetts, New York, North Carolina, Ohio, Pennsylvania and Texas — thousands of lawsuits against the named companies would be dropped by states and cities.
States have a month from July 21 — when this agreement was first reached — to decide if they will accept the deal. Following this decision, states will contact counties and cities who will have 150 days to decide if they would like to be included in the suit and receive funds from the settlement. At least 44 states as well as 95% of cities, counties and others suing the companies and 90% of non-litigating jurisdictions must sign on to the deal to receive a portion of the money. In some states, the final call will rest with the attorney general, while others will require legislative approval.
Under the agreement, the three distributors — Cardinal Health, AmerisourceBergen and McKesson — would make $21 billion in payments over 18 years, while drug maker Johnson & Johnson would pay $5 billion over nine years. The exact amount of the payments to each state and city will be determined by the number of governments who sign on to the agreement and the population and impact of opioid addiction in each region.
According to The New York Times, a novel feature of this agreement is a provision that distributors establish an independent clearinghouse to track one another’s shipments, a new mechanism to make data more transparent and make it easier to know when oversized orders are placed.
A separate agreement between these four companies and Native American tribes is still being worked out. This settlement would only bind these four companies. Other suits against different drug manufacturers and distributors are still being processed.
The CSG Justice Center has resources available to states that are looking for evidence-based strategies to improve outcomes for people with substance abuse disorders. Additionally, the Justice Center also provides resources on best practices for successful reentry for people with opioid addictions and opioid addition screening and assessment for those in the criminal justice system.