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State begins distribution of opioid settlement funds to all counties

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Money from combined national opioid lawsuits is making its way to every county in the State of Tennessee. Lake County is slated to receive an initial payment of $35,533.44 distributed by Tennessee’s Opioid Abatement Council, which is overseeing more than $31.4 million from the state’s share of the federal lawsuit settlements levied against Janssen (Johnson & Johnson).
Distribution of the funds from an Opioid Abatement Trust to all 95 counties in the state began the last week of February.
In accordance with terms of the Distributor and Janssen (Johnson & Johnson) settlement agreements negotiated by the Tennessee Attorney General, 35 percent of proceeds went directly to county governments so that local leaders could direct spending on programs to address the effects of opioids on their citizens and communities.
Tennessee has joined a broad coalition of states and subdivisions in reaching a $26 billion settlement with four companies to resolve legal claims for their role in the opioid crisis. Tennessee’s share of the settlement funds is expected to exceed $600 million over 18 years. The settlement consists of two agreements. One agreement is with the three major pharmaceutical distributors: AmerisourceBergen Corporation, Cardinal Health, Inc., and McKesson Corporation. The second agreement is with an opioid manufacturer: Janssen, a subsidiary of Johnson & Johnson.
As of Jan. 27, 2022, 51 states and territories and more than 7,000 local governments signed on to the agreements.
In Tennessee, more than 150 local governments have joined, including every county and all cities with populations of 25,000 or more.
On Feb. 25, 2022, the companies announced that the participation levels were sufficient for settlements to become effective.
In addition to the two settlement agreements, there is also a Tennessee State-Subdivision Opioid Abatement Agreement. This Tennessee-specific agreement, negotiated with representatives of the state’s subdivisions, addresses the allocation provisions in the two settlements and sets out a structure for the distribution of abatement funds from pending bankruptcy plans. The agreement has been adopted by the state and its subdivisions.
County leaders are able to select activities from a list approved by the Tennessee Opioid Abatement Council at its meeting in September 2022. Approved uses include a continuum of opioid use disorder treatment programs, medication assisted treatment, recovery supports, and prevention measures.
The remaining 65 percent of settlement dollars will be distributed through a competitive grant application process to be established by the Opioid Abatement Council. The processes for applying for funding and scoring applications are on the agenda for the Council’s next meeting at the end of the month.
The first payments to come from the Opioid Abatement Trust fund mark a milestone in the state’s work to address the effects of the opioid crisis. Payments from these settlements, while not as large as this initial payment, will continue annually for 18 years.
“While no amount of money will be enough to completely heal broken communities, funds distributed through the Opioid Abatement Trust Fund will provide further resources toward recovery and assist in bringing this epidemic to a halt. The Tennessee Attorney General’s Office will not let up on holding opioid manufacturers and distributors accountable,” said Tennessee Attorney General Jonathan Skrmetti.
Tennessee’s Opioid Abatement Council was created by the Tennessee General Assembly in Public Chapter 491 to manage the disbursement of proceeds from lawsuits relating to opioids. The Council upholds the responsibility to ensure the disbursements of these funds go toward funding programs, strategies, expenditures, and other actions designed to prevent and address the misuse and abuse of opioid products and treat or mitigate opioid use or related disorders or other effects of the opioid epidemic.
Tennessee has joined a broad coalition of states and local political subdivisions in reaching nationwide settlements with two additional manufacturers (Allergan and Teva) and three national pharmacy chains (CVS, Walgreens, and Walmart). If all five of the “second wave” settlements are fully adopted nationally, the maximum payments to Tennessee and its qualifying local governments would be more than $490 million. Most states have joined the settlements, but for the agreements to become effective, a critical mass of political subdivisions must sign onto the settlements by April 18, 2023.
To learn more about the Tennessee Opioid Abatement Council and settlements, visit TN.gov/oac.

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