The agreement would allow funds to begin flowing from the companies to states and communities to pay for addiction and prevention services.
After nearly two years of wrangling, the country’s three major drug distributors and a pharmaceutical giant have reached a $26 billion deal with states that would release some of the biggest companies in the industry from all legal liability in the opioid epidemic, a decades-long public health crisis that has killed hundreds of thousands of Americans.
The agreement, announced Wednesday afternoon by a bipartisan group of state attorneys general, lays the framework for billions of dollars to begin flowing into communities across the country for addiction treatment, prevention services and other steep expenses from the epidemic.
If the agreement is finalized, thousands of local governments as well as states would drop lawsuits against the companies and also pledge not to bring any future action.
The deal comes as the addiction crisis is worsening. Overdose deaths from opioids hit a record high in 2020, the Centers for Disease Control and Prevention reported earlier this month, a rise driven partly by the isolation and shutdown of services during the coronavirus pandemic. In all, more than 500,000 have died from overdoses to prescription and illegal street opioids since 1999, according to federal data.
“The urgency of the problem continues,” said Attorney General Herbert H. Slatery III of Tennessee at the news conference announcing the deal. “It’s just relentless.” Tennessee, whose own spike in opioid deaths was particularly sharp in 2020, could receive more than $500 million if the agreement is finalized.
The four companies that would be bound by the settlement — Johnson & Johnson and the drug distributors Cardinal Health, AmerisourceBergen and McKesson — are widely seen as having some of the deepest pockets among the corporate opioid defendants and this agreement was eagerly anticipated as a major pillar in the national litigation.
The distributors, which by law are supposed to monitor quantities of prescription drug shipments, have been accused of turning a blind eye for two decades while pharmacies across the country ordered millions of pills for their communities. Johnson & Johnson, which supplied opioid materials to other companies and made its own fentanyl patches for pain patients, is accused of downplaying the products’ addictive properties to doctors as well as patients.
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Cohen Milstein represented the states of Vermont and Indiana in their litigation against the three distributors and the State of New Jersey in its litigation against Janssen Pharmaceuticals (a subsidiary of J&J) as well as assisting these states in investigations and other litigation related to the marketing, distribution and sale of opioids.