On July 21, 2021, a group of state attorneys general proposed a $26 billion settlement proposal to resolve claims that McKesson Corp., Cardinal Health, Inc., AmerisourceBergen Corp., and Johnson & Johnson (“J&J,” and together with McKesson Corp., Cardinal Health, Inc., and AmerisourceBergen Corp., the “Settling Parties”) contributed to the opioid epidemic in the United States.

The proposed settlement was designed to resolve over 3,000 lawsuits involving allegations that the drug distributors ignored signs that opioids were being diverted for illicit use and that J&J downplayed the risks of addiction while marketing opioids.  Under the settlement proposal, distributors McKesson Corp., Cardinal Health, Inc., and AmerisourceBergen Corp. are expected to pay a combined $21 billion over the next 18 years, while J&J will pay $5 billion over the next 9 years.

On September 4, 2021, the Settling Parties announced that they will go forward with the proposed $26 billion settlement, after deciding that enough states were participating in the settlement to form a “critical mass.”  According to the Settling Parties, 42 states, five territories and Washington DC have signed on to the agreement.  The Settling Parties announced that they intended to make their first annual settlement payment into escrow on or before September 30, 2021.  Cities and counties within participating states have through January 2, 2022 to join the agreement as well.

Related links available at: Law 360 Coverage, Reuters