Johnson & Johnson and Distributors Complete Milestone $26 Billion Opioid Scheme

(Camden, NJ) — Drugmaker Johnson & Johnson and three major distributors reached a nationwide settlement Friday over their roles in the opioid addiction crisis, an announcement that paves the way for $26 billion to flow to nearly every state and local government in the U.S.

Taken together, the settlements are the largest yet of many opioid-related cases across the country. They are expected to provide significant impetus to efforts to reverse the crisis in places devastated by it, including many parts of rural America.

Johnson & Johnson, AmerisourceBergen, Cardinal Health and McKesson announced the settlement plan last year, but the deal was subject to the participation of a critical mass of state and local governments.
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Friday was the deadline for the companies to announce whether they believed enough governments had committed themselves to participate in the settlement and waive the right to sue. The four companies notified government lawyers in the event that their thresholds were met, meaning money could flow into the communities in April.

“We will never have enough money to solve this problem immediately,” said Joe Rice, one of the lead attorneys representing local governments in the lawsuit that led to the settlement. “What we’re trying to do is give a lot of small communities a chance to try and change some of their problems.”

While the settlement money will not go directly to victims of opioid addiction or their next of kin, the vast majority of it should be used to help combat the epidemic. The need for funding runs deep.

Kathleen Noonan, CEO of the Camden Coalition of Healthcare Providers, said some of the settlement money should be used to provide homeless people with housing for those with addictions.

“We have clients who struggle to keep clean to make it in a shelter,” she said. “We’d like to stabilize them so we can help them recover.”

Dan Keashen, a spokesman for the Camden County government, said officials are considering using settlement money for a public education campaign to warn of the dangers of fentanyl. They also want to send more drug counselors to the streets, place additional social workers in municipal courts and pay for drug addiction treatment in the county jail.

Read more: Why Prescription Opioids Aren’t Just a Problem for White Americans

Officials across the country are considering pumping the money into similar priorities.

The proposed budget from California Governor Gavin Newsom calls for $50 million of the state’s projected $86 million share this year to be spent on opioid education for youth and to train clinicians, improve data collection, and distribute naloxone, a drug that reverses overdoses.

In Florida’s Broward County, home to Fort Lauderdale, the number of beds in a county-run detoxification facility could be increased from 50 to 70 or 75, said Danielle Wang French, a county attorney.

“It’s not enough, but it’s a good start,” she said of the settlement.

As deadly overdoses continue to rage in the US, largely due to the proliferation of fentanyl and other illegally produced synthetic opioids, public health experts are urging governments to use the money to ensure access to drug treatment for people with addictions. They also emphasize the need to fund programs that are proven to work, collect data on their efforts and launch prevention efforts targeting youth, all while focusing on racial equality.

“It shouldn’t be: ready, fixed expenses,” said Joshua Sharfstein, a former secretary of the Maryland Department of Health and now vice dean of public health at Johns Hopkins University. “It should be: think, strategize, spend.”

In a separate deal also included in the $26 billion, the four companies reached a $590 million settlement with the federally recognized Native American tribes. About $2 billion is set aside for fees and expenses for the attorneys who have worked on the case for years.

New Brunswick, New Jersey-based Johnson & Johnson has nine years to pay its $5 billion share. The Distributors — AmerisourceBergen, based in Conshohocken, Pennsylvania; Cardinal Health of Columbus, Ohio; and Irving, Texas-based McKesson — agreed to pay their combined $21 billion over 18 years. To reach the maximum amounts, states must encourage local governments to sign up.

The settlements go beyond money. J&J, which has stopped selling prescription opioids, agrees not to resume. The distributors agree to send data to a clearinghouse intended to signal when prescription drugs are diverted to the black market.

The companies are not admitting wrongdoing and are continuing to defend themselves against claims that they caused the opioid crisis and made by entities not involved in the settlements.

The demand that most of the money be used to tackle the opioid crisis stands in stark contrast to a series of public health settlements in the 1990s with tobacco companies. In those cases, states used large portions of the settlement money to fill budget deficits and fund other priorities.

Read more: ​​​​Older Americans are the ignored victims of the opioid epidemic

The amount sent to each state under the opioid regime will depend on a formula that takes into account the severity of the crisis and the population. County and local governments will also receive shares of the money. A handful of states — Alabama, New Hampshire, Oklahoma, Washington and West Virginia — have not joined or part of the settlement, mainly because they have their own agreements or are preparing to go to trial.

In Camden, Lisa Davey, a recovery specialist for Maryville Addiction Treatment Center, was at a needle exchange this week to hand out naloxone, a drug that reverses overdoses, and asked people if they wanted to start treatment.

Davey said she wants detox and treatment programs to get more money to keep people in them longer. As it is, she said, users can detox and be back on the streets looking for drugs in a matter of days.

“They need more time to work on their recovery,” she said.

A man who picked up clean needles and wanted to be identified only as Anthony P. said he was 46 and had struggled with addiction since his teens. He said he would like to see an effort to phase out fentanyl and related synthetic opioids that are increasing death rates from drug overdoses.

“Fentanyl has to go,” he said.

Martha Chavis, president and CEO of Camden Area Health Education Center, which operates the needle exchange, said there is a need to offer services like hers in more places. Now users from far-flung suburbs travel to Camden to get clean needles and kits to test their drugs for fentanyl.

The settlement with J&J and the three distributors marks an important step toward resolving the vast amount of lawsuits in the US over liability for an epidemic linked to the deaths of more than 500,000 Americans over the past two decades.

Other companies, including business consultant McKinsey and drug makers Endo, Mallinckrodt and Teva, have reached national or a series of local settlements. OxyContin maker Purdue Pharma and a group of states are in mediation through the US bankruptcy court to try to reach a nationwide settlement.

The crisis has been exacerbated during the coronavirus pandemic, with the number of opioid-related deaths in the US rising to more than 76,000 in the 12 months ending in April 2021, largely due to the spread of fentanyl and other lab-made drugs. A recent report by a committee of the medical journal Lancet predicted that 1.2 million Americans could die from opioid overdose between 2020 and 2029 without policy changes.

John F. Kelly, a professor of psychiatry of addiction medicine at Harvard Medical School, said he wants the money from the settlements to be spent not only on treatment, recovery and support, but also building systems designed to prevent such epidemics. again.

“Some sort of national council or organization could be set up … to prevent this kind of lack of oversight from happening again – where the industry is allowed to create a public health hazard,” he said.

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