Companies Strike $26 Billion Deal with States and Cities to End Opioid Lawsuits

When Johnson & Johnson, the distributors and a smaller group of states announced their proposed settlement in July, the companies said they needed an unspecified majority of plaintiffs to sign to ensure an end to the lawsuits. The announcement Friday morning indicates that a sufficient threshold has been reached, or at least 90 percent of eligible governments to participate, and 46 of 49 eligible states for the distributors and 45 for Johnson & Johnson. Courts in every state will now have to sign the agreements, a process that is expected to be relatively smooth and fast.

Under the agreements, a state will receive its full allocation if all of its local governments sign the deal. For example, all of North Carolina’s 100 counties and 47 municipalities agree, and the state gets the $750 million allotment.

“Communities in North Carolina will begin receiving money this year to help people struggling with substance abuse,” said Josh Stein, the state attorney general and a leader of a bipartisan coalition of states that negotiated with the companies for nearly three years. and local governments. “The treatment, recovery, prevention and harm reduction services that will be available statewide will help people regain control of their lives and make North Carolina a safer place.”

There are still some states and places that oppose the distributors of Johnson & Johnson, including Washington, Oklahoma, and Alabama. But legal experts say that stance could be dangerous: The results of a few completed studies point to favorable resolutions for the companies, suggesting that continuing the fight with the governments that rejected the deal is a risk the companies are willing to take. to take.

This month, the same companies announced a tentative settlement with Native American tribes who suffered disproportionately high addiction and death rates during the opioid epidemic. Coupled with a $75 million deal that distributors signed with the Cherokee Nation last fall, the 574 federally recognized tribes could receive $665 million over nine years. An overwhelming majority of tribes are expected to sign the proposal.

A major theme that came up during the opioid disputes was the aggressive marketing of the drugs, which went virtually unchecked for years. Distributors almost never sent warning signals when pharmacy customers delivered amounts of opioids that were vastly disproportionate to the local population. A central feature of the new deal is that the distributors must set up an independent clearinghouse to track and report on each other’s shipments, a mechanism designed to provide immediate alerts when outsize orders are placed.

During the settlement negotiations, a secondary series of talks also took place between the states and local governments regarding the allocation of the funds. To date, about two dozen states have worked out their own distribution plans with local cities and counties also suing the companies.

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