Door County is among the state’s counties and cities that stand to receive a piece of the opioid settlement from drugmaker Johnson & Johnson and three companies that distributed opioid painkillers while addiction and overdose deaths skyrocketed in the United States.
The settling defendants are the country’s largest pharmaceutical distributors, known as the Big Three – McKesson Corporation, Cardinal Health and AmerisourceBergen – and opioid manufacturer Johnson & Johnson and its U.S.-based Janssen Pharmaceutical Companies. They have agreed per the settlement that communities across the country “have been harmed by misfeasance, nonfeasance and malfeasance” committed by them through their “manufacture, marketing, promotion, distribution or dispensing” of opioids.
The basic terms of the settlement require the Big Three to pay a maximum of $21 billion over 18 years, and Johnson & Johnson/Janssen to pay $5 billion over nine years.
Out of that potential $26 billion, $22.8 billion will be paid to states and local governments. Wisconsin’s share is $402,168,925.80. Of that, 70% goes to the state and 30% to the local governments such as Door County that opted into the suit in 2017. Door County’s share would be $794,488.51, based on an allocation percentage of 0.282%.
That percentage share was based on expenditures related to the state’s, county’s or municipality’s opioid crisis.
“Thankfully, Door County had been less impacted than other counties [up until 2017, when the lawsuits were first filed], and that is reflected by the roughly three-tenths of 1% we get in the settlement,” said Grant Thomas, corporation counsel, during the Tuesday county board meeting.
Milwaukee County would get 22.220% of the local-government unit share of the settlement dollars, for example; Dane County would receive 8.248% and Waukesha County 6.035%.
The Door County Board of Supervisors unanimously passed a resolution Tuesday authorizing it to take actions that would continue with the settlement portion of the lawsuit that the county agreed to enter into in 2017.
All except one of Wisconsin’s 72 counties – Polk County – joined the suit, but only 15 Wisconsin cities, villages or towns did, and none of the municipalities in Door County.
“When it became evident toward the end of summer that there will be a settlement, some local units of government across the U.S. wanted to opt in,” Thomas said. “It was decided if you weren’t in [in 2017], you weren’t going to be able to jump in on the wagon at the 11th hour.”
There is no class-action opt-out to the suit. Counties need to sign a participation agreement by Jan. 2, 2022. After that, both sides have options to walk away if there’s not enough participation from the local governments that initially joined the suit in 2017.
“About half of the funds are incentive payments that grow with participation,” Thomas said. “We need nearly 100% of participation in a given state to get 100% of the money.”
Thomas said the benefit the defendants gain from full participation is knowing their liability going forward.
Attorneys’ fees are 25% of a local government’s allocation. The attorneys will apply to a national fund being set up for those fees and out-of-pocket expenses, “but we don’t think that will pay much more than 5%, so we still have to pay 20% plus the cost of disbursement,” Thomas said.
In the end then, it’s a lot of money over a long period of time for the manufacturers and distributors to shell out, but not a lot of money to put toward opioid abatement for individual communities such as Door County. Reached by phone Wednesday, Thomas said the benefits extend beyond their monetary value to the principle of the situation.
“Somebody is being held responsible for something that was probably avoidable,” he said. “Also the injunctive relief that will hopefully prevent this from happening again in the future. It’s also the deterrent effect: Perhaps somebody else will think twice.”
The injunctive relief would be created through the establishment of a clearinghouse through which distributors will be required to account for not only their own shipments but also the shipments of other distributors to detect suspicious activity.
Johnson & Johnson stopped making opioids in 2020. Under the terms of the settlement agreement, the drug manufacturer will stop marketing and selling opioids for the next 10 years, is not permitted to lobby Congress for the next 10 years and will make its clinical trial data available for medical research.