NYS Opioid Settlement

Introduction:

New York Attorney General Letitia James has reached settlements totaling over $1.6 billion with companies involved in manufacturing, distributing, and selling opioids. These funds will be directed towards New York communities for treatment, recover, and prevention efforts.

New York Settlements:

  • Johnson & Johnson will pay up to $230 million to New York State. Payments will start in fall 2022 and continue over 9 years.
  • McKesson Corporation, Cardinal Health Inc., and Amerisource Bergen Drug Corporation — three of the nation's largest drug distributors — will pay up to $1.1 billion to New York State, of which more than $1 billion will go towards abatement. Payments will start in fall 2021 and continue over 17 years.
  • Allergan Finance will pay up to $200 million to New York state. Payment will be made in 2022.

New York State received additional funds under these settlements because the political subdivisions (including the counties and cities) signed on to the agreements and agreed to resolve existing or future claims against the companies.

  • Endo paid $50 million, with $22.3 million going to New York State.
  • McKinsey & Company will pay $32 million to New York State, as part of a $573 million settlement nationwide.

Other Financial Settlements:

  • Separately, Attorney General James and other Attorneys General have negotiated nationwide settlements with Johnson & Johnson and the three major drug distributers, totaling up to $26 billion nationwide. The New York State settlements described above will be included in the nationwide agreements. More information about these settlements can be found on the National Opioid Settlement Website.
  • The judge in the Purdue Pharma bankruptcy has approved a plan under which the Sacklers and entities they control would pay more than $4.5 billion for opioid abatement nationwide. If the plan goes into effect, New York State will receive over $200 million.

Allocation of Funds

Funds received as a result of these settlements will be divided among State agencies and localities for abatement and treatment. Allocations are governed by a formula to ensure that each part of the state gets an appropriate share of the funds.

In 2021, New York State enacted legislation to create a dedicated opioid settlement fund that will ensure that these settlements are directed towards abatement purposes. The legislation establishes an advisory board, appointed by the state and localities, to guide the legislature in appropriating the funds to state agencies, counties, and city governments.

Initial distribution of funds began in April 2022.

Ending the Opioid Abuse Crisis

In additional to financial relief for New York's communities, Attorney General James has secured commitments from these companies to take critical actions. This includes:

  • Establish a national clearinghouse to collect and analyze data from distributers about opioid orders and direct shipments. McKesson, Cardinal Health, and Amerisource Bergen will each report opioid shipments and the clearinghouse, operating under an independent monitor, will establish pharmacy-specific shipment levels to prevent over supply of opioids in communities.
  • Detect suspicious orders and prohibit shipments to pharmacies where there is evidence that opioids are being diverted outside of legitimate prescriptions.
  • Stop Johnson & Johnson from manufacturing or selling opioids and lobbying on activities related to opioids.
  • Stop McKinsey from advising companies on opioid-based Schedule II and III narcotics.
  • Shut down Purdue Pharma.
  • Ban the Sacklers from ever selling opioids again.
  • Ensure the public release of documents, including tens of thousands of internal documents, that provide insight into companies' roles in the opioid abuse crisis.

Ongoing NYS Litigation:

In March 2019, Attorney General James filed the nation's most extensive lawsuit to hold accountable the companies responsible for the opioid epidemic. The manufacturers named in the complaint included Purdue Pharma and its affiliates, as well as members of the Sackler Family (owners of Purdue) and trusts they control; Janssen Pharmaceuticals and its affiliates (including its parent company Johnson & Johnson); Mallinckrodt LLC and its affiliates; Endo Health Solutions and its affiliates; Teva Pharmaceuticals USA, Inc. and its affiliates; and Allergan Finance, LLC and its affiliates. The distributors named in the complaint were McKesson Corporation, Cardinal Health Inc., Amerisource Bergen Drug Corporation, and Rochester Drug Cooperative Inc.

The cases against Mallinckrodt and Rochester Drug Cooperative are now moving separately through U.S. Bankruptcy Court.

The case against Purdue Pharma and the Sacklers is also moving through U.S. Bankruptcy Court, and earlier this month, Attorney General James and a majority of states announced an agreement that would force the Sacklers and entities they control to pay more than $4.5 billion for opioid abatement, as well as shut down Purdue, and ban the Sacklers from ever selling opioids again. That plan was approved by the bankruptcy judge but is being appealed.

The settlements with Johnson & Johnson, Endo Health Solutions, McKesson Corporation, Cardinal Health Inc., Amerisource Bergen Drug Corporation, and Allergan Finance (described above) resolved the claims in the trial.

The trial against the remaining defendants - Teva Pharmaceuticals USA – ended with a verdict finding that Teva and its affiliates were liable for the public nuisance charges made by New York state. A subsequent trial will be held to determine how much Teva and others will be required to pay.

Additional Information:

Further questions about the opioid settlement can be directed to opioidsettlement@ag.ny.gov

Attorney General James is especially grateful for the ongoing collaboration with state attorneys general and their staffs and partners throughout New York State in the unfinished work of delivering justice and meaningful relief to those impacted by the opioid epidemic in New York and nationwide.

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