The meager opioid settlement won’t solve the addiction crisis — it needs federal funding

The $26 billion opioid settlement reached in late July has been described by many as a landmark achievement that will resolve many of the thousands of lawsuits against the opioid industry. If approved, the deal between the states and the country’s three largest drug distributors and drugmaker Johnson & Johnson would also provide a steady flow of much-needed funding for addiction services over the next 18 years.  

That sounds at first like a lot of money. Yet, given the scope of the nation’s severe addiction crisis, the settlement amount is woefully inadequate. After all, states, cities, counties and other jurisdictions brought the lawsuits, so the money would be divided among dozens of claimants and parceled out over nearly two decades. This, at a time when the worsening drug epidemic is devastating every corner of the country. 

A record 93,000 Americans died last year from drug overdose, mostly opioid-related. More than 500,000 have died over the past two decades. Today, the epidemic is sweeping through Black and Hispanic populations, and threatening inmates in prisons and jails more than ever. Overdose deaths from methamphetamines and other stimulants, in addition to synthetic opioids such as fentanyl, have also reached record levels. 

As it stands, compared with the $206 billion tobacco company settlement in 1998, the multibillion-dollar opioid industry — which, according to the lawsuits, underplayed the addictiveness of its products while deploying devious tactics to encourage their use, thereby contributing to the epidemic — appears to be getting off easy.  

Under the terms of the proposed agreement, compensation would be directed toward addiction services, with nothing going to the victims’ families, and the companies would not have to admit responsibility for their role in the epidemic — including, for example, drug distributors that shipped 81 million doses of an addictive prescription painkiller to just one small city in West Virginia. 

The four companies, which funneled an estimated $100 billion combined to shareholders through stock buybacks and dividends as thousands of people died, would also be shielded from any further prosecution and liabilities.  

This puts the states in a terrible bind: Faced with an escalating drug crisis, they desperately need more money now to significantly scale up services curtailed due to budget cuts during the COVID-19 pandemic. They want to hold the industry accountable, but if too many parties back out, the overall amount could be reduced or the deal scuttled altogether. So far, Washington and West Virginia have rejected the settlement, as has the city of Philadelphia. 

Thousands of other opioid lawsuits — in particular, against giant pharmacy chains — as well as the proposed $4.5 billion settlement of litigation against opioid maker Purdue Pharma, could eventually boost the total compensation, or lead to a bigger global settlement.   

There is another solution — one that would start funds flowing while opening the way for a more comprehensive and robust solution: Accept the meager $26 billion and other settlement deals to come on the condition that the federal government step in with additional support such that a total level of $125 billion is made available over the next decade. That’s the amount then-candidate Joe Biden promised for the opioid epidemic during his presidential campaign. 

The Biden administration has already requested $10.7 billion from Congress in its 2022 budget proposal to fight the opioid epidemic, but we need much more so that anyone struggling with substance use can access treatment. While the legal settlements on the table are far from perfect, when combined with a government funding boost it would together provide resources on a massive scale the crisis deserves. 

Mitchell S. Rosenthal, M.D., is a psychiatrist who founded Phoenix House, the national substance abuse treatment organization, and is now president of The Rosenthal Center for Addiction Studies in New York City.