As the opioid crisis continues to tear across the country, attorneys general have actively led the charge in combatting the opioid epidemic through:
- Advocating for state and federal legislation to stop the epidemic and actions to help those grappling with opioid-use disorder.
- Investigating and suing opioid manufacturers, distributors, and other related parties for their actions in fueling the crisis and to recover funds to help address the damage they have caused.
Opioids Investigations, Litigation, and Settlements
More than 3,000 state and local governments have targeted opioid makers and distributors in hopes of recouping billions in tax dollars spent dealing with the opioid epidemic. Attorneys general across the country have filed lawsuits against parties that have helped cause the opioids crisis. In addition, the attorneys general are working together to take advantage of shared resources, bringing maximum pressure on all participants who created and have benefited from the epidemic. That work continues through investigations, litigation, and settlements, some of which are highlighted below.
$26 Billion Agreement with Opioid Distributors/Manufacturer
On July 21, 2021, a bipartisan coalition of attorneys general announced final agreements with Johnson & Johnson, a manufacturer of prescription opioids, and the three major pharmaceutical distributors — Amerisource Bergen, Cardinal Health, and McKesson. These agreements resolve legal claims against those companies stemming from actions that fueled the opioid addiction epidemic in return for their payment of $26 billion and commitment to make major changes in how they do business to improve safety and oversight over the distribution of prescription opioid.
The states were represented in negotiations by an executive committee of 14 states, working in close coordination and communication with the remaining states and territories. The executive committee was led by Attorneys General Josh Stein (NC) and Herbert Slatery (TN) and included the attorneys general from California, Colorado, Connecticut, Delaware, Florida, Georgia, Louisiana, Massachusetts, New York, Ohio, Pennsylvania, and Texas.
Sample Press Announcements
Overview of the Settlement
- 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 funds was determined by agreement among the states using a formula that takes into account the impact of the crisis on the state–including the number of overdose deaths, the number of residents with substance use disorder, the quantity of opioids delivered–and the population of the state.
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.
- 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.
- The deadline for states to sign onto the agreements is August 21, 2021.
- Local jurisdictions in participating states have through January 2, 2022, to join.
- The first payments are expected to be received by participating states and subdivisions in April 2022.
Oklahoma Trial Against Johnson & Johnson
In 2019, Oklahoma’s lawsuit against Johnson & Johnson was the first case against an opioid manufacturer to go to trial out of the more than 2,000 other lawsuits filed around the nation. In August 2019, the court ordered pharmaceutical giant Johnson & Johnson to pay millions for its role in the state’s opioid crisis. Note that after the judgment was ordered, the court revised the judgment amount to correct a math error. This matter is currently under appeal.
In February 2021, a bipartisan coalition of attorneys general from 47 states, the District of Columbia and five U.S. territories, announced a $573 million settlement with one of the world’s largest consulting firms, McKinsey & Company (McKinsey), for its role in the opioid epidemic. The settlement resolves the states’ investigation into McKinsey’s role in advising opioid companies, helping them promote their drugs, and profiting from the opioid epidemic. This is the first multistate opioid settlement to result in substantial payment to the states to address the epidemic.
Funds from this multistate opioid settlement will pay for:
- Opioid treatment, prevention, and recovery programs in participating states.
- An online document repository, available to the public, which will include tens of thousands of its internal documents detailing McKinsey’s work for Purdue Pharma and other opioid companies.
- The states’ costs in mounting the investigation and litigation.
As part of the $573 million multistate settlement negotiated by the bipartisan multistate coalition of attorneys general, McKinsey paid $15 million in order to reimburse costs and expenses of the investigations and enforcement activities of the attorneys general and to establish an online repository of opioid industry documents. NAAG received these funds in order to administer them on behalf of attorneys general according to the settlement agreements.
- $7 million of the total is to reimburse the states costs and expenses related to the many opioids investigations and enforcement activities of the attorneys general, which were funded through grants from the NAAG Financial Services and Consumer Protection Enforcement, Education, and Training Fund. This fund was established by the National Mortgage Settlement to be self-sustaining to support investigations, enforcement actions, and training for attorneys general in consumer protection matters.
- Approximately $7.7 million is to fund the establishment of an online repository of opioid industry documents for the benefit of the public, which is similar to the repository of tobacco industry documents established by the Tobacco Master Settlement Agreement.
- The remaining balance is to reimburse additional opioids-related costs and expenses of attorneys general.
Finally, McKinsey agrees to adopt a strict document retention plan and continue its investigation into allegations that two of its partners tried to destroy documents in response to investigations of Purdue Pharma. The company must implement a strict ethics code that all partners must agree to each year, and it must stop advising companies on potentially dangerous Schedule II and III narcotics.
The multistate investigation was led by an executive committee made up of the attorneys general of California, Colorado, Connecticut, Massachusetts, New York, North Carolina, Oklahoma, Oregon, Tennessee, and Vermont. The executive committee is joined by the attorneys general of Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, North Dakota, Ohio, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Virginia, Wisconsin, Wyoming, the District of Columbia, and the territories of American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.
- Public Health
- Substance Use
We have witnessed first-hand the devastation that the opioid epidemic has wrought on states in terms of lives lost and the costs it has imposed on our healthcare system and the broader economy.
- Public Health
- Substance Use
This legislation is crucial to federal and state efforts to curb the opioid epidemic nationally and within each individual state. It is for these reasons that we commend Senators Portman and Manchin for their leadership in bringing forward this important legislation, and we urge you to take up and pass S. 2701 before the DEA’s temporary order expires.
- Public Health
- Substance Use
Unfortunately, there are three significant barriers to treating opioid use disorder that we cannot change at the state level and that must be tackled at the federal level. We share these barriers below in the hope that we can work together to remove them and allow more providers to offer treatment for opioid use disorder and other substance use disorders.