By Emma Nitzsche
A group of state attorneys reached a landmark, $26 billion settlement resolving claims against Johnson & Johnson and the three largest U.S. drug distributors over their role in the U.S. opioid crisis.
The attorneys claimed the distributors, McKesson, Cardinal Health, and AmerisourceBergen, helped fuel the deadly nationwide opioid epidemic. The distributors are expected to pay a collective $21 billion over the next 18 years, while J&J will pay $5 billion over nine years, with up to $3.7 billion paid during the first three years.
The settlement accuses the drug distributors of insufficient control over massive amounts of addictive painkillers. Although the companies denied the allegations, the attorneys argued that the painkillers were diverted into illegal channels, harming many people and devastating communities.
J&J was accused of marketing harmful drugs without warning consumers of their addictive nature. The agreement would result in court orders forcing J&J to stop selling opioids, halting third-party grants that research opioids, and refraining from lobbying on any activities related to opioids.
In addition to the accusations, the settlement requires the implementation of an independent clearinghouse to provide drug distributors and state regulators information about where drugs are traveling. The hope is that the information gathered from the clearinghouse will allow lawmakers and negotiators to regulate high drug trafficked areas.
In a joint statement released Wednesday, the three companies stated: “While the companies strongly dispute the allegations at issue in the trial, they believe this revolution will allow the companies to focus their attention and resources on the safe and secure delivery of medications and therapies while delivering meaningful relief to affected communities, and will also support efforts to achieve a broad resolution.”
The opioid epidemic continues to overwhelm the U.S. as the addictive drug has caused thousands of overdose deaths since 1999. According to the Centers for Disease Control and Prevention data, more than 93,000 people died from drug overdoses in 2020, the highest number ever recorded. However, since opioids affect some areas of the U.S. more than others, there is great debate about evaluating the settlement terms.
According to a press release from New York Attorney General Letitia James, nearly 4,000 entities have filed lawsuits in federal and state courts against the four companies. If approved by a significant number of state and local governments, the proposed agreement would resolve all the claims in one fell swoop.
The maximum payment requires at least 48 states, 98% of litigating local governments, and 97% of the jurisdictions that have yet to sue.
New York, California, Colorado, Connecticut, Delaware, Florida, Florida, Georgia, Louisiana, Massachusetts, North Carolina, Ohio, Pennsylvania, Tennessee, and Texas were involved in reaching the proposed settlement agreement.
Connecticut Attorney General William Tong said the deal was the second-largest cash settlement on record, surpassing the $200 billion tobacco agreement reached in the late 1990s.
“There’s not enough money in the world frankly to address the pain and suffering,” said Tong in a statement.
It will be challenging to get the required number of entities to sign on to the bill. Hard hit states like West Virginia and New Hampshire said they would most likely not participate in the settlement, as some are currently dealing with more minor cases within their respective states.
