Arizona Reaches Tentative $26 Billion Opioid Settlement Agreement

Arizona Reaches Tentative $26 Billion Opioid Settlement Agreement

The Arizona Attorney General’s Office announced that it has signed on to a tentative historic $26 billion multistate settlement with four pharmaceutical companies for their roles in the opioid crisis. The tentative agreement includes Cardinal, McKesson, and AmerisourceBergen – the nation’s three major pharmaceutical distributors – and Johnson & Johnson, which manufactured and marketed opioids.

According to the Attorney General’s Office, final details, including a critical mass of states and political subdivisions nationally, are necessary to finalize the settlement. If finalized, Arizona would receive up to $549 million from the settlement and the money would be used for opioid treatment, prevention, and education.

If the settlement is finalized, Arizona’s funds will be distributed through the Arizona Opioid Settlement Memorandum of Understanding (One Arizona Plan). In October 2020, the AGO and local governments (90 cities and towns and all 15 counties) signed on to the One Arizona Plan to maximize Arizona’s amount of recovery from opioid settlements. The One Arizona Plan also ensures that funds will be expeditiously distributed across Arizona. Read more on the One Arizona Plan here .

Funding Overview:

  • Nationally, the three distributors (Cardinal, McKesson, and AmerisourceBergen) collectively will pay up to $21 billion over 18 years.
  • Nationally, 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.
  • After attorneys’ fees and costs, the money is to be spent on opioid treatment and prevention.
  • Arizona’s share of the national funding has been determined by an agreement among the states using a formula that takes into account the impact of the crisis on the state and the population of the state.

Injunctive Relief Overview:

  • 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.
    • 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.

In order for the multistate settlement to be finalized, a critical mass of participating states and local governments will need to sign on.

The settlement comes as a result of investigations by state attorneys general into whether the three distributors fulfilled their legal duty to refuse to ship opioids to pharmacies that submitted suspicious drug orders and whether Johnson & Johnson misled patients and doctors about the addictive nature of opioid drugs. The settlement would resolve claims of both states and local governments across the country, including the nearly 4,000 that have filed lawsuits in federal and state courts.

Tragically, last year, drug overdose deaths rose to a record 93,000, according to the Centers for Disease Control and Prevention. Arizona saw a 30 percent increase in overdose deaths over the prior year, claiming more than 2,600 lives in 2020. Countless more have seen their lives torn apart by the disease of addiction. The damage, which continues in part every day due to an insecure southern border, also impacts their families, friends and communities.