State to Get Roughly $60 Million from Cardinal, McKesson, AmerisourceBergen, and Johnson & Johnson
Vermont Business Magazine Attorney General Donovan today announced an anticipated settlement agreement in principle with three distributors of opioids sued last year by his office – Cardinal, McKesson, and AmerisourceBergen – and Johnson & Johnson, which manufactured and marketed opioids. This is a nationwide settlement agreement, valued at $26 billion. The amount of Vermont’s portion of the settlement amounts to roughly $60 million. The settlement agreement also requires significant industry changes that will help prevent this type of crisis in the future. This is a separate settlement from the Purdue Pharma bankruptcy plan, to which Donovan continues to object (see below).
The Cardinal, McKesson, et al, settlement agreement would resolve investigations and litigation over the companies’ roles in creating and fueling the opioid epidemic.
“Vermont will likely receive approximately $60 million, and it is imperative that some of this money be directed to local communities to abate the opioid crisis,” Attorney General Donovan said.
The settlement agreement will resolve the claims of both states and local governments across the country, including those in Vermont. States have 30 days to sign onto the deal and local governments in the participating states will have an additional 120 days to join to secure a critical mass of participating states and local governments. Payments under the settlement will be maximized if state and local governments join together in support of the agreement.
The final terms of the settlement agreement are still under review.
In 2020, 157 Vermonters died of an opioid overdose, a 38% increase from 114 deaths in 2019.
Mayor Miro Weinberger made the following statement regarding the settlement:
“While we will need to complete a detailed review before formally deciding to join this national settlement, I am encouraged by both the $23 billion size of the agreement, and the sense of urgency driving this week’s announcements. The tragic epidemic of drug overdoses, initially fueled by greed and health policy errors, continues to take the lives of far too many of our loved ones.
“In the wake of the pandemic, we are redoubling our regional efforts to expand access to treatment, break down barriers to long-term treatment, and support successful recovery for people suffering from opioid use disorder. These efforts will get a major boost if these settlement resources are allocated to existing collaborative local efforts that center the needs and voices of the people harmed by opioids.”
Statement by Attorney General T.J. Donovan on Vermont’s Opposition to Purdue Bankruptcy Plan
I have officially objected to the proposed bankruptcy plan in the Purdue Pharma bankruptcy. The primary basis of the Objection is that the Court does not have the authority to release states’ civil claims against the Sackler family in a bankruptcy proceeding because it would violate State sovereignty. Through this bankruptcy plan, the founders and owners of Purdue – the Sackler family – are leveraging their enormous wealth to shield themselves from liability.
Purdue Pharma’s Proposed Settlement Would Net Vermont a Paltry Sum - Seven Days
The plan allows them to extinguish the states’ lawsuits against the Sacklers. At the end of the bankruptcy, the Sacklers will keep billions of dollars in wealth made from the opioid crisis, a substantial portion of which they are shielding in offshore accounts. Meanwhile, the states will continue to struggle to abate the crisis the Sacklers caused.
I want to acknowledge the toll of the opioid crisis on Vermont families, neighbors, and communities. I will continue to pursue those responsible for the opioid crisis and seek to hold them accountable.
A copy of the Objection can be found here and Vermont’s Joinder here. With the bankruptcy plan having been objected to, the next step in the case will be a confirmation hearing, scheduled for August 9, at which the bankruptcy court will hear and address the objections.
Source: MONTPELIER – 7.21.2021 Office of the Attorney General