Delaware is moving closer to getting $43.6 million from a settlement with two giant drug store chains over sales of opioids. It adds up to a quarter of a billion dollars that is expected to be used in opioid treatment in a state hard hit by the crisis.
Proceeds will mainly go to addiction treatment rather than compensation to families
Attorney General Kathy Jennings announced she finalized settlement agreements with CVS and Walgreens. It brings the national amount from investigations and litigation against the pharmaceutical industry for its role in the opioid crisis to more than $50 billion.
Attorneys generals from both political parties filed suits claiming that drug manufacturers and drug store chains should have known that opioid pills were being dispensed at a rate well in excess of legitimate demand. It added up to millions of pills being dispensed at some Delaware pharmacy locations, according to a story from DelawareOnline (paywall).
Delaware’s share of today’s agreements is approximately $43.6 million. Under the latest agreements, CVS will pay $5 billion and Walgreens will pay $5.7 billion, totaling $10.7 billion.
AG Jennings also announced that she plans to join, two separate national settlements with Teva and Allergan, both opioid manufacturers. These two settlements will bring in an additional $25.2 million to the state’s fight against the opioid crisis.
These agreements build on prior opioid settlements by AG Jennings with Johnson & Johnson, AmerisourceBergen, Cardinal Health, and McKesson (valued at $111.3 million for Delaware); Purdue Pharma (valued at up to $50 million); Walmart ($11.8 million); Mallinckrodt (valued at up to $4.8 million); McKinsey & Co. ($2.58 million); and Endo (valued at up to $2 million) for a total of roughly $250 million in expected opioids-related recoveries.
“The true cost of the epidemic is measured in lives, not dollars,” said Jennings. “Delaware has suffered one of the nation’s worst fatal overdose rates — just four days ago, public health officials announced that November 2022 is expected to set a new record for overdose fatalities. This is an especially painful time of year for families who have lost loved ones, and I am mindful of the fact that no amount of money can fully repair the damage done to our state. The task ahead of us is to save as many lives as we can; to support Delawareans in recovery; and to continue to hold Big Pharma accountable for its hand in the crisis.”
Of late, more deaths have been coming from the use of fentanyl
In addition to the financial terms, the settlements with CVS and Walgreens — and an earlier settlement with Walmart — include court-ordered injunctive relief that requires the pharmacies to monitor, report, and share data about suspicious activity related to opioid prescriptions. This court-ordered injunctive relief is intended to help prevent similar crises from occurring in the future.
Each state will have an opportunity to review and to join, after which the five agreements (Walmart, Walgreens, CVS, Teva and Allergan) will go to local governments around the country for sign-on during the first quarter of 2023.
Under Senate Bill 166, bipartisan legislation supported by AG Jennings, Delaware’s share of these and any other opioid settlements will go to the state’s Prescription Opioid Settlement Distribution Fund, which is governed by an independent commission. Spending from the Settlement Fund is largely restricted to services that reduce or remediate the harm caused by opioids, a release stated.
Payments under these agreements are structured to ensure sustained resources over time. Most of Walmart’s amount will be paid during the first year; Allegan’s payments will be over seven years; CVS’s payments will be spread over ten years; Teva’s payments will be over 13 years; and Walgreens’ payments will be spread over 15 years. If there is sufficient buy-in by states, the first payments will begin arriving in 2023.
Delaware undertook negotiations in concert with the attorneys general of California, Colorado, Connecticut, Illinois, Indiana, Iowa, Kentucky, Louisiana, Massachusetts, Nebraska, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Tennessee, and Texas.
