The Opioid Settlement & What it Means For You
In 2019, nearly 50,000 people in the United States died from opioid-involved overdoses. The numbers grew in 2020. The misuse of and addiction to opioids—including prescription pain relievers, heroin, and synthetic opioids such as fentanyl—is a serious national crisis that affects public health as well as social and economic welfare. There are estimates that the total "economic burden" of prescription opioid misuse in the United States is $78.5 billion a year, including the costs of healthcare, lost productivity, addiction treatment, and criminal justice involvement. For more information on the epidemic, you can visit https://www.drugabuse.gov/drug-topics/opioids/opioid-overdose-crisis.
The Southeast has been hit particularly hard by the epidemic. In 2017, when we began this litigation, Alabama had more opioids distributed per person than any other state in the country, with Mississippi and Georgia not far behind.
Knowing that we had to do something to reduce the scourge in our state, our firm has had the honor of representing over 60 cities and counties in Alabama, Georgia, and Mississippi in the Opioid litigation that has been ongoing for the last 4 years. We put together a team of local lawyers from Alabama, Mississippi, and Georgia to work with the consortium that led the fight on the national level. This month, those efforts culminated in a proposed settlement with the “Big Three” distributors (the three largest pharmaceutical distributors – McKesson, Cardinal Health, and AmerisourceBergen), and a manufacturer, Janssen Pharmaceuticals, Inc., and its parent company, Johnson & Johnson.
The Settlement Agreement and other information about the proposed resolution can be found at https://nationalopioidsettlement.com.
If adopted by states and subdivisions nationwide, these distributors will pay a maximum of $21 billion over 18 years, while Johnson & Johnson will pay a maximum of $5 billion over no more than nine years, with a total of approximately $22.8 billion in settlement proceeds payable to state and local subdivisions. Settlement funds will be used for abatement of the Opioid Epidemic but it also calls for injunctive relief – requiring the distributors and Johnson & Johnson to change their processes and procedures to ensure this won’t happen again.
Some states may choose not to participate and, if they do not, the local governments within those opt-out states will also be excluded. Attorney generals within the states will have 30 days to decide whether to participate.
The number of cities and counties in each state who agree to the settlement will affect how much money each state and its subdivisions will receive. This settlement is only open to governmental entities. Claims brought on behalf of private individuals and businesses (including third-party payers like health and welfare funds, and insurers) are not included.
The Next Steps
Local government clients do not need to take any action right now. Instead, wait for your attorney general to determine whether your state is participating in the national settlement. Your retained counsel should contact you to discuss the next steps once your state decides whether to participate.
This settlement does not affect the claims of individual and business clients. Local individuals and businesses benefit from the Opioid remediation funding and injunctive relief provided by the settlement but will not receive direct payments from this settlement. You should discuss any individual claims with your local lawyer.