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States reach $26B opioid settlement with Johnson & Johnson, 'big three' distributors

Pharmaceutical giant Johnson & Johnson denied wrongdoing but agreed to pay up to $5 billion to settle charges stemming from the opioid epidemic. File photo by Justin Lane/EPA-EFE 
Pharmaceutical giant Johnson & Johnson denied wrongdoing but agreed to pay up to $5 billion to settle charges stemming from the opioid epidemic. File photo by Justin Lane/EPA-EFE 

July 21 (UPI) -- A coalition of state attorneys general on Wednesday announced a proposed $26 billion settlement with pharmaceutical companies associated with facilitating the opioid crisis.

Under the settlement, the "big three" opioid distributors McKesson, Cardinal Health and Amerisource Bergen Drug would pay up to $21 billion over the next 18 years.

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Manufacturer Johnson & Johnson, meanwhile, would pay as much as $5 billion over the next nine years depending on how many state and local governments agree to suspend their opioid lawsuits.

The agreement would resolve as many as 4,000 opioid-related claims.

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A total of 14 states including New York, California, Colorado, Connecticut, Delaware, Florida, Georgia, Louisiana, Massachusetts, North Carolina, Ohio, Pennsylvania, Tennessee and Texas were involved in reaching the agreement.

Each state's finding has been determined using a formula that calculates the number of opioid overdose death in a state, the number of residents with substance use disorders, the number of opioids prescribed and the population of the state.

West Virginia Attorney General Pattrick Morrisey opposed the formula, telling NPR the deal focuses too much of the settlement money on population rather than the severity of the crisis in a state.

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"West Virginia is a resounding no on these agreements and will continue to litigate and negotiate outside the framework of today's announcement," Morrisey said.

The Plaintiffs Executive Committee, a coalition of attorneys representing the state and local governments, endorsed the settlement.

"Our country's opioid epidemic is a nationwide public health crisis that requires a nationwide solution," the group said.

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States have 30 days to opt-in to the deal, while local governments have 150 days to agree to the settlement.

In addition to the payments, the settlement requires Johnson & Johnson to stop selling opioids, funding or providing grants to third parties for promoting opioids and lobbying for activities related to opioids.

McKesson, Cardinal Health and Amerisouce Bergen would be required to share data with an independent clearinghouse, account for their own shipments as well as the shipments of other distributors and stop and report suspicious orders.

"While the companies strongly dispute the allegations at issue in the trial, they believe this resolution will allow the companies to focus their attention and resources on the safe and secure delivery of medications and therapies while delivering meaningful relief to affected communities, and will also support efforts to achieve a broad resolution," the three companies said in a joint statement.

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Johnson & Johnson denied wrongdoing, saying its actions manufacturing and marketing opioids were "appropriate and responsible" but said it would agree to pay the settlement based on the number of states that agree.

"We recognize the opioid crisis is a tremendously complex public health issue, and we have deep sympathy for everyone affected," said Michael Ullmann, Johnson & Johnson's executive vice president and general counsel. "This settlement will directly support state and local efforts to make meaningful progress in addressing the opioid crisis in the United States."

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