Oregon receives first installment of $270 million in payments from historic opioid settlement
Another $62 million due in separate settlement with Johnson & Johnson
SALEM, Ore. (KTVZ) -- Help is on the way — lots of it — for Oregonians with substance abuse issues. Attorney General Ellen Rosenblum announced Friday that Oregon received the first round of payments from an historic $21 billion settlement with the three largest distributors of opioids — Cardinal, McKesson, and AmerisourceBergen.
“These funds should have an immediate impact for Oregon families who have been advocating for more treatment and prevention programs,” said Attorney General Rosenblum.
Altogether, Oregon will receive $270,386,383 over 18 payments (two payments this year, annually thereafter).
Oregon will receive $25 million this year — with the potential for as much as $45 million more from a separate settlement with Johnson & Johnson (see Additional Background below) — if certain Oregon special districts agree to participate.
On top of this, Oregon will receive approximately $95 million from the settlement with Purdue Pharma. The timing of the first payments to Oregon in the Purdue settlement will be determined by the outcome of an appeal to the Second Circuit Court of Appeals.
“I could not be prouder of our legal team,” added AG Rosenblum. “We went into overdrive to find an equitable way to distribute such a large amount of money for both the state and local governments. For more than 15 years now, the Oregon Department of Justice has been a leader in holding the pharmaceutical industry accountable. We filed numerous cases against opioid manufacturers, distributors, and the firms that assisted in promoting opioids. Because we were right — and handled these cases skillfully and diligently — we have obtained significant results for Oregonians.”
ADDITIONAL BACKGROUND
In December 2021, Attorney General Rosenblum announced an agreement with Oregon’s cities and counties for the allocation of Oregon’s approximately $329 million share of the historic settlement.
Specifically, the settlement agreement outlines that the funds will be used for:
- Prevention programs,
- Naloxone distribution and education,
- Syringe services,
- Medication-assisted treatment, treatment and services for pregnant and postpartum people,
- Treatment and services for incarcerated populations,
- Neonatal abstinences syndrome treatment,
- Warm handoff recovery programs and services,
- Leadership, planning and coordination;
- Data Collection & Research.
At the time of the settlement with the three manufacturers and distributors, Oregon also announced a $5 billion global settlement with drug manufacturer Johnson & Johnson. Oregon will receive a total of $62 million from this settlement, with the first payment arriving in the coming months.
This year, the Oregon legislature created an Opioid Settlement Prevention, Treatment and Recovery Board, administered by the Oregon Health Authority and overseen by a board of health policy experts and state and local government representatives. The Board is responsible for administering the state’s share of funds and investing in an evidence-based state system to collect, analyze and publish data about the efficacy of substance use prevention, treatment and recovery services across the state.
As outlined in the current settlement agreement with the State of Oregon and various counties and cities, 45% of the funds will be deposited into a statewide Prevention Treatment and Recovery Fund, to be administered by the PTR Board. The additional 55% will go directly to Oregon cities and counties to fund prevention, treatment, and recovery services at the local level.
Per AG Rosenblum: “My goal — as I will communicate to the PTR Board — is to get these dollars out to communities as quickly and efficiently as possible. The opioid epidemic has been a heartbreaking crisis, and we have no time to waste. With that said, we must also use these dollars effectively and strategically. I look forward to hearing more from the Board and from local governments once they have decided how to use these important funds.”
Other highlights of the Oregon Department of Justice’s role in the opioid crisis include:
Allergan/Teva
Confidential negotiations with the opioid manufacturer Allergan are ongoing, with a reported $2.37 billion proposal being proposed to participating states (including Oregon). Taken together with the settlement in principle with Teva Pharmaceuticals, these agreements could provide up to $6.6 billion nationwide. Details on how much Oregon will receive will be forthcoming.
Distributors/Johnson & Johnson (Janssen)
In March 2022, Oregon announced that the final agreement with the historic $26 billion opioid agreement against the three largest distributors of opioids (McKesson, AmerisourceBergen and Cardinal Health) and the drug manufacturer Johnson & Johnson was approved. Under the agreement, Oregon and its cities and counties will receive $329 million over the coming years. Oregon was part of the lead groups of attorneys general negotiating both settlements.
Endo International
In 2016, Oregon opened an investigation into Endo International, a pharmaceutical company that sold Opana, an extended-release opioid like OxyContin. Last month, AG Rosenblum sued Endo for aggressively promoting the dangerous drug, which is no longer on the market. Oregon recently defeated Endo’s motion to dismiss the lawsuit, which is ongoing.
Insys Therapeutics
In 2015, Oregon was the first state to investigate and settle with Insys Therapeutics for its unlawful promotion of Subsys, a powerful narcotic fentanyl that is typically used for end-stage cancer pain. The $1.1 million settlement helped increase the availability of naloxone (used to reverse overdose), treat opioid use disorder, and train prescribers to decrease prescribing of prescription opioids.
McKinsey & Company
AG Rosenblum was also a leader in the multi-state group that settled with McKinsey & Company, one of the world’s largest consulting firms, for its role assisting opioid manufacturers in promoting opioids. In February 2021, the group, including Oregon, settled for $573 million, with Oregon receiving almost $8 million.
Purdue Pharma
In 2007, Oregon DOJ joined 25 other states in a settlement of the first multi-state lawsuit with Purdue Pharma. In 2018, Oregon DOJ again sued Purdue for violating the 2007 agreement, deceptively marketing OxyContin to Oregon seniors and misrepresenting the risks of the drug.
Then, in May 2019, Oregon became one of the first states to sue the owners of Purdue Pharma, the Sackler family. Later in 2019, AG Rosenblum sued the Sacklers again, alleging their personal responsibility for the deceptive and unlawful promotion of OxyContin. Oregon was then one of nine states that rejected the original offer in the Purdue bankruptcy, which resulted in the Sackler family paying an increase of 40% more. Oregon will receive approximately $95 million out of the $6 billion global settlement, with the first payments arriving in Oregon later this year, if the 2ndCircuit approves the settlement.
