TOPEKA, Kan. (KSNW) – Kansas Attorney General Derek Schmidt announced Friday that the nation’s top pharmaceutical distributors reached a $26 billion opioid settlement to help fund the nation to treat and prevent opioid addiction.
Under a state law enacted last year, the money received from this settlement will be used to address substance abuse and help ensure addiction services are provided through the state.
The agreement has been formed with Cardinal Health, Inc., McKesson Corporation, AmerisourceBergen Corporation, and drugmaker Johnson & Johnson after a three-year effort to resolve over 4,000 claims against the companies. It is the second-largest multistate settlement agreement in U.S. history after the Tobacco Master Settlement in 1998.
Kansas has qualified to recieve the maximum amount of payments under the agreement, $190 million, after receiving 100% sign-on from the Kansas political subdivisions. The first distribution of the settlement is expected later in spring and will continue for as many as 17 years.
“We have worked tirelessly to hold these companies accountable for the addiction and human suffering caused by years of their illegal business and marketing practices,” Schmidt said. “The court-ordered changes to their business practices will save countless lives going forward, and the money they must pay for the harm their past actions have caused will be dedicated to preventing and addressing drug addiction throughout Kansas. The settlements we announce today are proof that in the long run, justice is a greater force than greed.”
The conditions of the agreement with the pharmaceutical distributors include:
- Establishing an independent clearinghouse for tracking where drugs are going and how often.
- Maintaining a data-driven system to detect suspicious opioid orders from customer pharmacies.
- Terminating customer pharmacies’ abilities to receive shipments, and report those companies to state regulators, when they show certain signs of drug diversion.
- Prohibiting sales staff from influencing decisions related to identifying suspicious opioid orders.
- Requiring senior corporate officials to engage in regular oversight of anti-diversion efforts.
Johnson & Johnson will be required to:
- Stop selling opioids.
- Not 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.
State agencies, local governments and nonprofits may apply for funding through the grant review board, which is currently being formed.
“I am grateful for the cooperation and collaboration with city and county leaders in our state as we worked together to reach this settlement and maximize the benefit to the citizens we all serve,” Schmidt said. “This is a historic opportunity to address substance abuse and addiction in our state, and it is vital we continue working together to put these funds to best use.”
Principle agreements were also reached to resolve the state’s claims against Purdue Pharma and Mallinckrodt Pharmaceuticals plc, but they have filed for bankruptcy. As a result, negotiations are continuing through bankruptcy court proceedings.
Kansas is also in ongoing investigations and negotiations with other companies believed to have played a role in illegally fueling opioid addiction.
Additional information about the opioid settlements is available here.