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J&J, distributors reach $26bn settlement to address the opioid crisis in the US

The proposed agreement would resolve claims of both states and local governments in the US

Johnson & Johnson, along with three distributors, have reached a ‘landmark’ settlement to deliver up to $26bn to address the opioid crisis in the US. 

The proposed agreement would resolve claims of both states and local governments in the US, including almost 4,000 that have filed lawsuits in federal and state courts.

States now have 30 days to sign onto the deal, while local governments in the participating states have up to 150 days to join.

For the full amount to be delivered, the agreement requires the support of at least 48 states, 98% of litigating local governments as well as 97% of jurisdictions which have yet to sue.

If all states agree to the proposed deal, the settlement will provide a base payout of $12.2bn and a further $10.7bn if local governments also agree to join.

Breaking down the settlement, the three named distributors – Cardinal, McKesson and AmerisourceBergen – will pay up to $21bn over 18 years.

Meanwhile, J&J will pay up to $5bn over nine years with up to $3.7bn to be paid in the first three years. The majority of the money will go towards opioid treatment and prevention initiatives in the US.

As part of the agreement, J&J will be required to stop selling opioids, nor fund or provide grants to third parties for promoting opioids.

The pharma giant will also have to share clinical trial data under the Yale Open Data Access Project.

“No amount of money, no number of sanctions, will be able to right these wrongs,” said Pennsylvania Attorney General Josh Shapiro.

“But this settlement puts in place controls that will go a long way to make sure that this never happens again, and the money that will come to Pennsylvania will help offer and expand life-saving treatment options across our Commonwealth.”

According to the US Centers for Disease Control and Prevention (CDC), overdose deaths involving opioids have increased over six times since 1999.

In 2019, overdoses involving opioids were responsible for the deaths of nearly 50,000 people, with almost 73% of those deaths involving synthetic opioids.

In August 2019, J&J was ordered to pay $572m after judge Thad Balkman concluded it was guilty of misleading marketing strategies that helped to cause a surge in opioid addiction and overdose deaths in the state of Oklahoma.

Article by
Lucy Parsons

22nd July 2021

From: Regulatory

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