A recent Law 360 story by Dave Simpson, “Ohio Cuts $808M Opioid Distributor Deal Plus $42M Legal Fees,” reports that the nation's three largest drug distributors struck an $808 million deal with Ohio, and agreed to pay $42.4 million in legal fees and implement reforms, to end the Buckeye State's claims in opioid litigation in relation to an upcoming nationwide settlement, the state attorney general announced. Ohio Attorney General Dave Yost said that the deal with Cardinal Health Inc., AmerisourceBergen Corp. and McKesson Corp. is better than the national settlement, because it includes the legal fees.
The deal will start providing Ohio cities and counties with payments as early as November as part of an 18-year payment schedule, and the cash is guaranteed even if the national agreement falls apart, he said. In July, seven attorneys general formally announced a global opioid settlement worth $26 billion with Johnson & Johnson, as well as the three distributors in the deal. The deal will be distributed through Gov. Mike DeWine and Yost's OneOhio plan, with 85% of the cash targeted for local distribution and 15% going back to the state. That plan was unveiled in March 2020.
Under the plan, 55% of any settlements reached would go toward a state foundation that would fund local projects to address the crisis while 30% would be sent directly to 2,000 counties, townships, villages and cities for community recovery. More than 23,700 Ohioans died of opioid overdose from 2010 through 2019, Yost alleges. The deal requires the three distributors to undergo a series of reforms, Yost said.
The deal requires that they "establish a centralized independent clearinghouse to provide all three distributors and state regulators with aggregated data and analytics about where drugs are going and how often, eliminating blind spots in the current systems used by distributors," Yost said. In July, the same distributors struck a similar $1.1 billion opioid deal with New York's attorney general. That deal is also not contingent on the national deal going through.
The nationwide deal would end the bulk of the suits levied over the opioid crisis. Up to $5 billion would come from J&J over the next nine years and $21 billion from the distributors over the next 18 years, with up to $23.5 billion of the total going toward easing the opioid epidemic and the rest going to attorney fees and costs. Ohio's deal was backed by 99% of so-called "litigating subdivisions," which are local governments within the state that stand to benefit from the deal, Yost said.