Alabama on Tuesday reached a settlement with three companies, including Johnson & Johnson, for hundreds of millions of dollars to end claims over their roles in the state's opioid epidemic. Photo by Justin Lane/EPA-EFE
April 19 (UPI) -- Alabama has reached a $276 million settlement with two pharmaceutical manufacturers and a distributor to settle lawsuits over their roles in the opioid epidemic.
The state's attorney general, Steve Marshall, announced the settlement agreement Tuesday, saying Alabama will receive $141 from pharmaceutical distributor McKesson Corporation, $70.3 million from Johnson & Johnson and $25 million from Endo Pharmaceutical.
While the state will receive lump-sum payments from the two pharmaceutical manufactures, McKesson Corporation will pay the state over a nine-year span.
"Having encountered the utter darkness of the opioid crisis at my own doorstep, this is one of my most meaningful accomplishments as your attorney general," he said in a statement.
The funds will be evenly split between the state and its subdivision for use to mitigate the effects of the opioid epidemic. The money will be deposited in the state's general fund and lawmakers decided how best to use it.
The state will also receives an additional $40 from the companies to cover attorneys' fees and costs.
Johnson & Johnson said in a statement that the settlement removes it from cases filed in the state and that the deal is consistent with the framework of nationwide opioid settlement of $26 billion previously announced, in which it is contributing $5 billion.
"This settlement is not an admission of any liability or wrongdoing and the company will continue to defend against any litigation that the final agreement does not resolve," it said.
McKesson Corporation and Endo Pharmaceutical have been asked for comment.
Alabama has remaining claims against opioid manufactures Purdue Pharma, Mallinckrodt and Insys in each of their bankrupty cases.
The agreement comes after Marshall withdrew Alabama from the multibillion-dollar national settlement late last summer in order to pursue its own individual claims.
Marshall on Tuesday described the three agreements as affirming his decision to not join the national settlement, which he said "did not adequately acknowledge the unique harm that Alabamians have endured and would have redirected millions of dollars to bigger states that experienced a less severe impact."
Marshall's office states that if Alabama stayed in the national agreement, it would have received $115.8 million to be paid over 18 years from McKesson, the same $70. 3 million from Johnson & Johnson but to be paid over nine years and potentially up to 35% less from Endo, a figure derived by seeing what comparable states received from the company.
According to the Department of Health and Human Services, the opioid epidemic followed pharmaceutical companies in the late 1990s reassuring the medical community that patients would not become addicted to opioid pain relievers, resulting in healthcare providers prescribing the drugs in greater numbers.
The increase in opioid prescriptions led to widespread misuse of opioids of both prescription and non-prescription drugs. In 2017, the Department of Health and Human Services declared the opioid epidemic a public health emergency.
Data from the from the U.S. Centers for Disease Control and Prevention shows that in 2019 there were nearly 71,000 drug overdose deaths in the United States, of which 70% involved opioids.
Meanwhile, U.S. overdose data shows that Alabama has among the nation's highest prescription rate for opioids.
The Alabama Department of Mental Health has stated that while the state's per-capita opioid prescription rate has been dropping since a national high of 143.8 prescriptions per 100 residents in 2012, it is still the highest.
In 2016, the rate was down to 121 prescriptions per 100 people and in 2018 it had slipped further to 97.5, which, according to the National Institute on Drug Abuse, was the highest in the nation and nearly twice as high as the national average of 51.4 prescriptions per 100 people.
On Tuesday, West Virginia announced it had reached a $99 million deal with Johnson & Johnson subsidiary Janssen Pharmaceutical to settle a lawsuit over its role in the state's opioid crisis.
Along with Alabama and West Virginia, Oklahoma and Washington chose not to participate in the national settlement.