Attorney General Ellison signs onto $20B in new opioid settlements
New settlements with five major manufacturers and pharmacies may bring more than $235 million to Minnesota over 15 years for opioid epidemic treatment and prevention; also require document disclosure, industry changes to ensure crisis never happens again
New payments to be in addition to the more than $300 million Minnesota obtained in earlier agreements
December 20, 2022 (SAINT PAUL) — Minnesota Attorney General Keith Ellison today announced Minnesota has signed onto five new national settlements worth $20.4 billion with major opioid manufacturers Teva Pharmaceuticals and Allergan, and three of the nation’s largest retail pharmacy chains — Walmart, CVS, and Walgreens. Attorney General Ellison previously announced agreements in principle with Teva and Allergan in July 2022.
Minnesota’s share of the agreements could be upwards of $235 million over 15 years, on top of the more than $300 million already coming to Minnesota from earlier settlements with Johnson & Johnson and opioid distributors, Mallinckrodt, Endo, McKinsey, and Purdue. The new settlements will bring more much-needed relief to communities in Minnesota and across the country that continue to suffer devastating effects from the opioid crisis.
“We’re continuing to hold opioid companies and others that contributed to the crisis accountable for the death and destruction they’ve caused in Minnesota and around the country. No amount of money can ever restore the lives we’ve lost or make up for the damage these companies have done, but these funds will flow to communities where the pain is still being felt. Also important are the settlement terms that require document disclosure to show how these companies did this to us, and the controls that will keep these companies from ever doing it again,” Attorney General Ellison said.
These new settlements are nearly identical in structure to the Johnson & Johnson and distributors’ settlements, funds from which began to flow to Minnesota communities in October 2022. This means that once again, participation by local governments is essential to Minnesota’s receiving the full amount of the settlement funds to which it is entitled. Local governments will soon receive notice of the settlements and will have until spring 2023 to sign onto them.
Similarly, the State anticipates funds from the settlements announced today will be allocated according to the State–Subdivision Memorandum of Agreement (MOA) it reached with cities and counties last December, providing for 75% of the funds being distributed directly to local governments, with 25% going to the State of Minnesota to be overseen and distributed by the Opioid Epidemic Response Advisory Council (OERAC). The State is working with cities and counties to update the agreement to accommodate these new settlements within the existing opioid framework. Nearly all the settlement funds must be used to remediate the opioid crisis, including treatment and prevention.
Attorney General Ellison and state attorneys general allege that Teva and Allergan contributed to the opioid crisis by overstating the benefits of opioids, downplaying the risk of addiction, and failing to maintain effective controls to prevent opioid diversion, and allege that the pharmacies misled patients and doctors about the addictive nature of opioids. They also allege Walmart, CVS, and Walgreens ignored significant red flags in dispensing opioid prescriptions, leading to diversion and misuse. Once the settlements announced today become effective, they will resolve the states’ and local governments’ investigations and lawsuits against these companies related to their role in causing and perpetuating the opioid crisis.
- Teva will pay up to $4.25 billion over 13 years.
- Allergan will pay up to $2.37 billion over 7 years.
- Walmart will pay up to $3.1 billion over 6 years, with a possibility for states to earn the entire amount in the first year.
- CVS will pay up to $5 billion over 10 years.
- Walgreens will pay up to $5.7 billion over 15 years.
- The total payments will be determined by the overall degree of participation by both litigating and non-litigating state and local governments.
- Under Minnesota’s MOA, all the settlement funds must be used to remediate the opioid crisis, including treatment, prevention, and recovery services.
Injunctive relief overview
In addition to the funds the companies are required to pay, Teva and Allergan have agreed to strict limitations on their marketing, promotion, sale, and distribution of opioids, including:
- A ban on promotion and lobbying;
- A ban on funding or grants to third parties; and
- A ban on rewarding or disciplining employees based on volume of opioid sales.
Additionally, Allergan is required to stop manufacturing and selling opioids for 10 years and Teva is required to create and maintain systems to prevent drug misuse, including suspicious order monitoring.
Walmart, CVS, and Walgreens are required to implement significant improvements in how they handle opioids, including requirements that they:
- Maintain independent departments to oversee compliance with controlled-substance laws and the injunctive terms in the settlements;
- Ensure pharmacists exercise independent judgment in the dispensing of controlled substances;
- Create and maintain robust oversight programs, including site visits and audits, to prevent diversion;
- Monitor, report, and share data about suspicious activity related to opioid prescriptions; and
- Provide data to the states about their red flag processes as well as blocked and potentially problematic prescribers.
Teva and Allergan are also required to publicly disclose millions of documents related to their role in the deadly opioid crisis, including internal documents that show how they misrepresented the risks and benefits of opioids and failed to curtail problematic orders for their opioid products, among other things.
Document disclosure has been a top priority of Attorney General Ellison’s as his office and other states have reached settlements with opioid companies. His office has worked closely with the Opioid Industry Documents Archive, operated jointly by the University of California–San Francisco and Johns Hopkins University, with the following results:
- In May 2022, the Opioid Industry Archive publicly released the first tranche of documents from opioid companies it acquired as part of a settlement: 1.4 million documents from manufacturer Mallinckrodt.
- In June 2022, the Archive released 114,000 documents from international consultancy McKinsey.
- In October 2022, the Archive released documents from pharmacies including CVS, Walgreens, and Walmart.
- In December 2022, the Archive released over 750,000 Insys documents, as well as documents related to Purdue Pharma.
Opioid crisis in Minnesota continues
The opioid epidemic continues to be a crisis of public safety and public health in Minnesota. The effect of the COVID-19 epidemic on addiction and mental health in Minnesota underscores the continuing importance of the Attorney General’s years-long efforts to combat the opioid crisis and hold opioid and other companies accountable.
Data from the Minnesota Department of Health shows that from 2020 to 2021, opioid-involved overdose deaths increased by 35%, to an all-time high of 924 deaths in 2021. Fentanyl, a highly potent synthetic opioid, was involved in the majority of the deaths.
Latest in a string of settlements with opioid companies
In addition to the five settlements with Teva, Allergan, Walmart, CVS, and Walgreens announced this week, Attorney General Ellison’s office has reached seven other major settlements or agreements in principle with opioid companies in the last three years to hold these companies accountable for their role in creating and perpetuating the devastating opioid epidemic:
- Agreement in principle with manufacturer Endo in August 2022;
- Settlements with manufacturer Johnson + Johnson and distributors AmerisourceBergen, Cardinal Health, and McKesson in July 2021;
- Settlement with Purdue Pharma, manufacturer of the blockbuster opioid OxyContin, in July 2021;
- Settlement with international consultancy McKinsey in February 2021;
- Settlement with manufacturer Mallinckrodt in October 2020; and
- Settlement with manufacturer Insys in January 2020.
Attorney General Ellison’s office maintains a page on its website with detailed information about the State of Minnesota’s settlements with opioid companies.