On Wednesday Attorneys General from several states, including Delaware, announced a historic $26 billion agreement with pharmaceutical distributors Cardinal, McKesson, and AmerisourceBergen and manufacturer Johnson & Johnson to bring desperately needed resources to fight the opioid crisis. Delaware will receive more than $100 million as part of the landmark settlement. In addition to the cash payment—the largest legal settlement since the multistate tobacco settlement– the agreement also requires significant industry changes that will help prevent this type of crisis from ever happening again. The agreement would resolve investigations and litigation over the companies’ roles in creating and fueling the opioid epidemic, said officials. Delaware was among the states in the complex, multistate negotiations, along with North Carolina, Tennessee, California, Colorado, Connecticut, Florida, Georgia, Louisiana, Massachusetts, New York, Ohio, Pennsylvania, and Texas.
The settlement will be paid out over 18 years, with funds directed to opioid abatement, including expanding access to opioid use disorder prevention, intervention, treatment, and recovery. Municipalities will receive 15 percent of the state’s allocation.
The agreement would resolve the claims of both states and local governments across the country, including the nearly 4,000 that have filed lawsuits in federal and state courts. Following the agreement, states have 30 days to sign onto the deal and local governments in the participating states will have up to 150 days to join to secure a critical mass of participating states and local governments. States and their local governments will receive maximum payments if each state and its local governments join together in support of the agreement.
Funding Overview:
• The three distributors collectively will pay up to $21 billion over 18 years.
• Johnson & Johnson will pay up to $5 billion over nine years with up to $3.7 billion paid during the first three years.
• The total funding distributed will be determined by the overall degree of participation by both litigating and non-litigating state and local governments.
• The substantial majority of the money is to be spent on opioid treatment and prevention.
• Each state’s share of the funding has been determined by agreement among the states using a formula that takes into account the impact of the crisis on the state – the number of overdose deaths, the number of residents with substance use disorder, and the number of opioids prescribed – and the population of the state.
Injunctive Relief Overview:
The 10-year agreement will result in court orders requiring Cardinal, McKesson, and AmerisourceBergen to:
• Establish a centralized independent clearinghouse to provide all three distributors and state regulators with aggregated data and analytics about where drugs are going and how often, eliminating blind spots in the current systems used by distributors.
• Use data-driven systems to detect suspicious opioid orders from customer pharmacies.
• Terminate customer pharmacies’ ability to receive shipments, and report those companies to state regulators, when they show certain signs of diversion.
• Prohibit shipping of and report suspicious opioid orders.
• Prohibit sales staff from influencing decisions related to identifying suspicious opioid orders.
• Require senior corporate officials to engage in regular oversight of anti-diversion efforts.
The 10-year agreement will result in court orders requiring Johnson & Johnson to:
• Stop selling opioids.
• Not fund or provide grants to third parties for promoting opioids.
• Not lobby on activities related to opioids.
• Share clinical trial data under the Yale University Open Data Access Project.
This settlement comes as a result of investigations by state attorneys general into whether the three distributors fulfilled their legal duty to refuse to ship opioids to pharmacies that submitted suspicious drug orders and whether Johnson & Johnson misled patients and doctors about the addictive nature of opioid drugs.
This settlement comes as a result of investigations by state attorneys general into whether the three distributors fulfilled their legal duty to refuse to ship opioids to pharmacies that submitted suspicious drug orders.
Source: Connecticut AG’s Office