Tennessee Office of the Attorney General

Tennessee Attorney General Herbert H. Slatery III announced an $26 billion agreement between several state government and local governments and major pharmaceutical distributors and producers in order to curb some impacts of the ongoing national opioid crisis.

According to a news release, the agreement with Cardinal, McKesson, and AmerisourceBergen, the nation’s three major pharmaceutical distributors, and Johnson and Johnson, which has manufactured and marketed opioids, will resolve the some 4,000 ongoing state and federal litigations and investigations into the companies roles in the public health crisis.

The negations were led by Slatery and North Carolina Attorneys General Josh Stein as well as attorneys general from California, Colorado, Connecticut, Delaware, Florida, Georgia, Louisiana, Massachusetts, New York, Ohio, Pennsylvania and Texas.

“We’ve reached an agreement in the most complicated civil case in American history,” General Slatery said in the news release. “Yes, it took several years. It required a lot of give and take from everyone involved but now we have one. The negotiating states were both red and blue; this was a bipartisan effort from start to finish. We acted on behalf, and at the direction of, a host of other states.

"Our objective was to solve a national problem that has touched virtually everyone in one way or another. We want all states and local governments to sign on. That way we can hold these companies accountable (as they should be), get immediate funds to programs that will reduce the crisis and save lives, and do so now, as opposed to years of litigation and the costs that go with it.”

The AG's office reports that in 2020 the United States saw opioid overdose deaths rise to a record 93,000, with opioid overdoses killing more than five people a day in Tennessee.

The AG's office reports that the agreement will include the following details.

  • The three distributors collectively will pay up to $21 billion over 18 years.
  • Johnson and 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.
  • Over two-thirds of the money is required to be spent on opioid treatment and prevention.
  • Each state’s share of the funding has been determined by agreement among the states using a formula that takes into account the impact of the crisis on the state – the number of overdose deaths, the number of residents with substance use disorder, and the volume of opioids prescribed – as well as the population of the state.

The agreement will also result in court orders requiring Cardinal, McKesson, and AmerisourceBergen to do the following:

  • 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 the drugs being diverted.
  • Prohibit shipping 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 agreement will also result in court orders requiring Johnson and Johnson to do the following:

  • Stop selling opioids for 10 years.
  • 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.

"Following today’s agreement, states have 30 days to join the deal and local governments in the participating states will have up to 150 days to join," the news release reads. "The deal’s ratification is contingent on a critical mass of states and local governments participating. States and their local governments will receive maximum payments if each state and its local governments join in support of the agreement."

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