On October 7, 2021, the Nebraska Attorney General provided NACO with additional information regarding two legal settlements recently entered into by the Attorney General against a manufacturer and several distributors of prescription opioid drugs. The first settlement concerns Johnson & Johnson. The second settlement concerns prescription drug distributors: McKesson, Cardinal Health, and AmerisourceBergen (collectively referred to as the “distributors”).
Both settlement agreements involve distributions of money on an annual basis to both a state fund and allow direct distributions of money on an annual basis to certain political subdivisions (referred to as “participating subdivisions”).
The monetary distributions under both settlement agreements are maximized for both the state’s share and each participating subdivision’s “direct share” when all participating subdivisions “sign on” to or execute each of the two settlement agreements. It is important to note that participating subdivisions must sign on to these settlement agreements in order to receive their direct share as well as to be eligible to receive any additional distribution or grant from the state’s share. Participating subdivisions that do not sign on to these agreements will not only not receive their direct share but will also not be eligible to receive any additional distribution or grant from Nebraska’s Opioid Recovery Fund.
Both the Johnson & Johnson and the distributors settlement agreements are the result of several years of negotiation that included both the state attorneys general and many private plaintiff attorneys representing cities and counties from around the country, the primary negotiating group of private attorneys is referred to as the plaintiff’s executive committee or the “PEC”. The PEC determined the allocation percentages of the political subdivision share for each participating subdivision in the United States. The political subdivision share is 15% of the total annual disbursement from the national administrator for each state. The state is also to receive 15%. The remaining 70% is allocated to a designated fund for the “abatement” of opioid addiction or opioid misuse and other co-occurring mental health or substance abuse issues. In Nebraska, the state’s 15% share is automatically added to Nebraska’s dedicated abatement fund, known as the “Opioid Recovery Fund”, according to the Opioid Prevention and Treatment Act passed in 2020 and found at Neb. Rev. Stat. §§ 71-2485 to 71-2490.