About the Settlements
After years of negotiations led by Attorney General Josh Stein and others, two proposed nationwide settlement agreements have been reached that would resolve all opioid litigation brought by state and local governments against the three largest drug distributors, McKesson, Cardinal Health and AmerisourceBergen (“distributors”), and one manufacturer, Janssen Pharmaceuticals, Inc., and its parent company Johnson & Johnson (“J&J”).
The proposed settlements require that the distributors and J&J pay $26 billion over 18 years, with approximately $22.7 billion available to state and local governments to address the opioid epidemic through treatment, recovery, harm reduction, and other life-saving programs and services. The settlements also include new rules to prevent diversion of prescription opioids and make sure nothing like this ever happens again.
The State of North Carolina has already signed the settlements, making North Carolina local governments eligible to participate. North Carolina’s share of settlement funds will be distributed among state and local governments pursuant to a Memorandum of Agreement that the state and more than 80 local governments have already agreed.
North Carolina stands to receive approximately $750 million through these settlements if every county and every municipality with a population over 10,000 participates. These funds will be available starting in 2022 to support treatment, recovery, harm reduction, and other life-saving programs and services. The settlements are the fastest and best way to get these funds to where they are most desperately needed – to communities from the mountains to the coast hit hard by the opioid crisis.
Under the NC MOA, 85 percent of settlement funds go directly to 100 counties and 17 municipalities – the most favorable state-level arrangement for local governments in the United States. Municipalities that do not receive direct payments under the settlements benefit because their respective counties will use settlement payments to provide treatment, recovery, harm reduction, and other life-saving programs and services to municipal residents.
Local government participation in the settlements is critical. If there is not sufficient local government participation, the settlements will not be finalized, the billions of dollars in abatement funds will not flow to communities, and more than 3,000 cases may be sent back to their home states for trial. These trials would take many years and – even in the best-case scenario – would result in a slow and inefficient distribution of funds.
The extent of local government participation also determines how much money North Carolina will receive under the settlements, because approximately half of the abatement funds are in the form of “incentive payments.” The higher the participation of counties and municipalities, the greater the amount of settlement funds that flow to our communities to address the epidemic.
Attorney General Stein strongly supports these settlements and urges North Carolina counties and municipalities to join the settlements. Likewise, the Plaintiffs’ Executive Committee (PEC) – charged with leading the opioid litigation on behalf of more than 3,000 cities, counties and others – has unanimously endorsed the settlements. Members of the Plaintiffs’ Executive Committee are listed here.
How to Join
Counties and municipalities must take specific, affirmative steps to participate in the national opioid settlements. These steps are separate and apart from any decision to sign onto the NC MOA. Any county or municipality that does not take affirmative steps to participate in the national settlements cannot directly share in any of the settlement funds.
The deadline for participation in the national settlements to maximize settlement benefits is January 2, 2022.
On or after September 18, 2021, every county in North Carolina and every municipality with a population over 10,000 will receive a formal notice of the national settlements with specific instructions on how to participate. Please review this notice carefully. If your subdivision is represented by an attorney with respect to opioid claims, please contact them immediately.
The North Carolina Department of Justice will continue to provide up-to-date information and resources on the national opioid settlements. Read the press release announcing the settlements and the press release calling on local governments to join.