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Four key opioid companies have reached a near-global settlement. Photo: John Moore/Getty Images

The three dominant prescription drug distributors — AmerisourceBergen, Cardinal Health and McKesson — and Johnson & Johnson have agreed to pay a combined amount of $26 billion to settle allegations that they fueled the country's opioid crisis.

Why it matters: The companies, which have admitted no wrongdoing, are paying a sum of money that equates to 4% of their combined annual revenue. Meanwhile, a record 70,000 Americans died from opioid overdoses during the pandemic in 2020.

By the numbers: The $26 billion settlement, announced by a group of state attorneys general, varies by company and will be paid out over time.

  • J&J: $5 billion over nine years
  • AmerisourceBergen: $6.4 billion over 18 years
  • Cardinal Health: $6.4 billion over 18 years
  • McKesson: $7.9 billion over 18 years
  • Each of the three drug distributors have already set aside funds in anticipation of a settlement.

The big picture: All states, except for West Virginia, and local governments will now have a chance to sign on to the settlement.

  • "The substantial majority of the money is to be spent on opioid treatment and prevention," the state AGs said.

What they're saying: "Distributors can easily bear this burden," analysts at stock market firm Baird wrote this week. "We think [Wall] Street is more than ready for substantial resolution, even if not all-encompassing ... We haven't popped the champagne yet, but the bottle is definitely chilling."

Flashback: In 2018, executives at AmerisourceBergen, Cardinal Health and McKesson told Congress they did not think their companies contributed to the opioid crisis.

What to watch: Settlements have still not been finalized with Purdue Pharma, other opioids manufacturers like Teva and pharmacies, although Purdue is working on a settlement through bankruptcy. Native American tribes also are pursuing legal action.

Go deeper

New York reaches $1.1 billion settlement with opioid distributors

Oxycodone pain pills prescribed for a patient with chronic pain on display on March 23, 2016 in Norwich, CT. Photo: John Moore/Getty Images

New York reached a $1.1 billion settlement on Tuesday with three of the country's largest drug distributors for their alleged role in the opioid epidemic, New York Attorney General Letitia James said.

The big picture: The settlement comes as the three companies — McKesson, Cardinal Health, and Amerisource Bergen — as well as Johnson & Johnson near a $26 billion deal with states and municipalities that would settle thousands of lawsuits related to the opioid crisis, the New York Times reports.

John Frank, author of Denver
Jun 17, 2021 - Axios Denver

Capitol Impact: Inside Colorado's crackdown on "Big Pharma"

Illustration: Rae Cook/Axios

Editor's note: Colorado's General Assembly approved more than 500 bills this year. In this occasional series, we unpack what it means for you.

Democratic lawmakers declared a war on "Big Pharma" this year, and delivered a handful of major bills designed to bring down the cost of prescription drugs.

Why it matters: Colorado spent nearly $4 billion on prescription drugs in 2018, according to an analysis, which equates to 13% of all health care spending.

Updated 15 mins ago - Politics & Policy

Pelosi appoints GOP Rep. Kinzinger to Jan. 6 committee

House Speaker Nancy Pelosi (D-Calif.) announced Sunday that she has appointed Rep. Adam Kinzinger (R-Ill.) to serve on the House select committee investigating the Jan 6. Capitol riot.

Why it matters: Pelosi's announcement comes after she rejected two of the five Republican appointments offered by House Minority Leader Kevin McCarthy (R-Calif.).