The deal is the second largest cash settlement in United States history, after only a $246 billion tobacco deal in 1998.
A group of state attorneys general in the United States have unveiled a $26bn settlement with major US pharmaceutical companies accused of fueling a deadly nationwide opioid epidemic, but some states were quiet on the deal.
Under the settlement proposal released on Wednesday, the three largest US drug distributors – McKesson, Cardinal Health and Amerisource Bergen – are expected to pay a combined $21bn, while drugmaker Johnson & Johnson will pay $5bn.
“There just isn’t enough money in the world to explicitly address the pain and suffering,” said Connecticut Attorney General William Tong, who said the money “will help where it is needed”.
The deal was the second-largest cash settlement ever, after only the $246 billion tobacco deal in 1998, and the largest unveiled in a multi-year legal effort to hold the industry responsible for the opioid crisis that caused it in the US. There have been over 500,000 deaths. in the last 20 years.
“Many companies manufacturing and distributing opioids nationwide, regardless of the lives or even the national crisis they were helping fuel,” said New York Attorney General Letitia James, attorney general for 15 states. One of said deal. .
“Today, we are holding these companies accountable and investing billions of dollars in communities across the country,” James said in a statement.
The settlement amount from the distributors will be paid in 18 years. J&J will pay over nine years, with up to $3.7bn to be paid out during the first three years. The money is expected to be used on addiction treatment, family support, education and other social programs.
“This agreement will directly support state and local efforts to make meaningful progress in addressing the opioid crisis,” said Michael Ullman, General Counsel for Johnson & Johnson.
Al Jazeera’s Gabriel Elisondo said settlement money could be distributed to states and territories as early as the end of the year.
Public health officials have said that if used properly, the funds “could be a good first step in halting the opioid epidemic in the United States”, Elisondo pointed out. “But again, it has to be used correctly.”
Distributors were accused of lax controls that allowed massive amounts of addictive painkillers to be diverted into illegal channels, devastating communities, while J&J was accused of downplaying addiction risk in its opioid marketing .
The companies have denied the allegations.
The agreement also calls for the creation of an independent clearinghouse to provide distributors and state regulators with aggregated data about drug shipments, which negotiators hope will help prevent abuse.
More than 3,000 lawsuits related to the health crisis, mostly by state and local governments, have been filed across the United States. Negotiators have struggled to find a structure that would garner enough local government support to assure defendants that a deal would eliminate nearly all litigation.
As a result, the final settlement amount depends on the extent to which states sign up for the deal and confirm that their cities and counties are on board.
“The expectation is north of 40 and will sign well north of 40,” North Carolina Attorney General Josh Stein said.
The opioid crisis has hit some parts of the US much more than others, creating divisions between governments when it comes to considering settlement. States will have 30 days to evaluate the agreement.
“States that don’t sign are irresponsible,” said Louisiana Attorney General Jeff Landry. “We do not want the perfect to be the enemy of the good.”
Meanwhile, the opioid crisis has shown no signs of giving up. Last week the US Centers for Disease Control and Prevention said provisional data showed 2020 was a record year for total drug overdose deaths, with 93,331 fatalities, up 29 percent from a year earlier.