New Jersey absolves corporations largely responsible for the opioid crisis

Four drug companies that made $665 billion last year are settling claims that they bear responsibility for the opiate epidemic for about $26 billion to be paid over 18 years, or about 0.2% of their revenues.

New Jersey intends to join nationwide settlement agreements with New Jersey-based Johnson & Johnson and the country’s three largest pharmaceutical distributors – McKesson, Cardinal Health, and AmerisourceBergen – to resolve claims involving their roles in fomenting the country’s opioid crisis.

States are racing to meet a deadline to commit to the opioid settlement with three drug distributors and one drug manufacturer, as critics express concerns the amount isn’t big enough to address the damage done by the epidemic of addiction or inflict real punishment on the corporate pushers who killed nearly 500,000 people from 1999–2019.

McKesson Corporation, which distributes pharmaceuticals, health information technology, medical supplies, and care management tools, had revenues of $231 billion in 2020.

Cardinal Health had revenues of $162 billion and was awarded a $58 million contract by the U.S. Department of Health and Human Services (HHS) on April 13, 2021, with options that could reach $91.6 million, for the storage and distribution of 80,000 pallets of personal protective equipment (PPE) to support the Strategic National Stockpile (SNS).

AmerisourceBergen distributes brand name and generic pharmaceuticals, over-the-counter health care products, supplies and equipment and had revenues of $190 billion last year.

Johnson & Johnson is ranked No. 36 on the 2021 Fortune 500 list of the largest United States corporations by total revenue, which was $83 billion last year.

Johnson & Johnson is headquartered in New Brunswick, New Jersey, and it is one of the world’s most valuable companies, and one of only two U.S.-based companies that has a higher prime credit rating than that of the United States government.

“The opioid crisis has devastated too many New Jersey families and ending the opioid epidemic continues to be one of my Administration’s highest priorities,” said Governor Phil Murphy.

“By holding these pharmaceutical distributors accountable for their deplorable actions in fueling the marketing and sale of opioids, we are preventing them from creating another drug crisis in the future,” said Murphy. “The funds received from this settlement will aid critical opioid use disorder resources and programs, which will strengthen our ability to save lives by preventing overdose deaths and connecting New Jerseyans to supports and treatment when they need it most.”

In July, New Jersey joined a global resolution of lawsuits that states had brought against the Sackler family and their opioid-manufacturing company, Purdue Pharma.

That settlement – valued at approximately $4.32 billion – is expected to leave members of the Sackler family, some of whom own Purdue Pharma and served on the company’s board of directors, still very wealthy as it dips into their net worth of more than $11 billion over a long period of time and grants immunity from opioid lawsuits to hundreds of individuals, businesses and financial trusts that profited from dealing addictive drugs.

According to legal documents filed as part of the case, that immunity would extend to dozens of family members, more than 160 financial trusts, and at least 170 companies, consultants and other entities associated with the Sacklers in exchange for an estimated $110 million for New Jersey.

Critics say corporate tax breaks could slash the value of the $26 billion deal by more than $4 billion, while the Sackler family will remain fabulously wealthy and free from criminal prosecution despite holding responsibility for so many deaths and addictions.

“If they get away with it, that means less money going into the treasury, less money for programs that would help deal with the fallout for the opioid crisis,” said Rep. Jimmy Gomez (D-CA).

“While there may be relief among some lawyers, this deal failed to achieve justice and leaves more than half the Sackler family’s net worth intact despite clear proof that these drug dealers are responsible for thousands of deaths,” said progressive Democrat Lisa McCormkick. “This settlement is about to shield members of the Sackler family from civil litigation regarding their alleged roles in the opioid crisis. America does not have Justice for all.”

In the late 1990s, pharmaceutical companies assured doctors that patients would not become addicted to prescription opioid pain relievers, and health care providers began to prescribe them at much greater rates.

This subsequently led to widespread diversion and misuse of these medications before it became clear that these medications could indeed be highly addictive. Opioid overdose rates began to increase.

Nearly one million Americans have died since 1999 from a drug overdose, including about 50,000 per year who died as a result of an opioid overdose, including prescription drugs, heroin, and illicitly manufactured fentanyl, a powerful synthetic medication.