Drug Companies Are Settling With States. How Will The Money Be Spent?

Pills and Money

The answer most advocates and stakeholders are hoping for is on prevention, treatment, and other programs directly addressing the opioid crisis.

A piece from Governing explores how some states plan to spend their payout money and what has been learned from the tobacco settlements.

In Oklahoma, nearly $200 million of its $270 million payout from Purdue Pharma and the Sackler family, which owns Purdue, will go toward establishing the National Center for Addiction Studies and Treatment at Oklahoma State University in Tulsa. Local governments will get $12.5 million. About $60 million went toward legal fees.

In some ways, the tobacco settlement provides a cautionary tale.

Most of those proceeds have disappeared into state general funds, leaving just a portion left over to help defray the public health costs of smoking. According to a 2007 report from the Government Accounting Office, states on average had allocated just 30 percent of their settlement money to health care. Nearly as much — 23 percent — went to cover budget deficits.

During the 2019 session, the Maryland General Assembly passed legislation to guarantee profits of the State’s opioid litigation are used to confront the opioid epidemic. The legislation requires monetary damages awarded to the State as a result of litigation against the opioid industry to be deposited into a dedicated Opioid Restitution fund. MACo supported the bill as it is imperative that money from litigation efforts provide communities with much-needed resources to meet their treatment, education, and enforcement needs.

Recently, Attorney General Brian Frosh filed charges in concert with four other states against the owners and former directors of Purdue Pharma, the Sackler Family, for their role in creating the epidemic. The charges allege they were the chief architects and beneficiaries of the company’s false marketing and deception in violation of consumer protection laws.

For more information:

How Will Governments Spend Their Opioid Settlements From Drug Companies? (Governing)

Attorney General Frosh Charges Controlling Owner-Directors of Purdue Pharma With Violations of Consumer Protection Act (Office of the Attorney General)