Opioid Settlement

​​​​​​SUMMARY OF PROPOSED OPIOID SETTLEMENTS

Background

On February 25, 2022, Attorney General Daniel Cameron delivered on his promise to fight back against the opioid epidemic by announcing the finalization of a $26 billion agreement with Cardinal, McKesson, and AmerisourceBergen – the nation’s three major pharmaceutical distributors – and Johnson & Johnson (J&J), which manufactured and marketed opioids, for the companies’ role in creating and fueling the opioid epidemic. 

The settlement resolves more than 4,000 claims of state and local governments across the country. It is the second-largest multistate agreement in U.S. history, second only to the Tobacco Master Settlement Agreement. 

Tentative settlement details were initially announced on July 21, 2021, and, after careful review, Attorney General Cameron signed the settlement on behalf of the Commonwealth. He was joined by a broad coalition of states and subdivisions in joining both settlement agreements, one with opioid manufacturer Johnson & Johnson and another with the three pharmaceutical distributors: AmerisourceBergen, Cardinal Health, and McKesson.

Financial Relief

The two settlement agreements require the distributors and J&J to pay billions of dollars to abate the opioid epidemic, totaling $26 billion over 18 years, with approximately $22.7 billion available for opioid abatement. ​

Kentucky's $478 million share of the settlement will be distributed pursuant to the terms of House Bill 427, which allocates 50 percent of all proceeds to local governments, with the Commonwealth receiving the other 50 percent. The Commonwealth's portion will be managed by the Kentucky Opioid Abatement Advisory Commission. To review the details regarding the use and disposition of funds received by the settlements, please see KRS 15.291 and KRS 15.293. 

Injunctive Relief

Both agreements contain injunctive relief provisions that govern the marketing, sale, and distribution of opioids. The terms also require distributors to implement additional safeguards to prevent future diversion of prescription opioids, including the establishment of an independent monitor to prevent deliveries of opioids to pharmacies where diversion and misuse occur. The distributors will also be required to establish and fund an independent clearinghouse to track opioid distribution nationwide and flag suspicious orders. J&J will be prohibited from selling or promoting opioids.​