Carlsbad Joins National Opioid Regulations, Provides $ 1.6 Million Payment

CARLSBAD – The city of Carlsbad will join a $ 26 billion nationwide settlement resulting from a lawsuit against major pharmaceutical companies over the opioid crisis that has devastated communities across the country for decades.

Carlsbad City Council approved the decision to join the legal payment at its December 14 meeting.

The state of California expects to receive between $ 1.8 billion and $ 2.6 billion from the settlement, according to a staff report, and the city of Carlsbad is budgeting $ 1.6 million as part of the settlement.

In July, a bipartisan coalition of state attorneys general announced the deal against the three largest pharmaceutical distributors – McKesson, Cardinal Health and AmerisourceBergen – as well as manufacturer Janssen Pharmaceuticals Inc and its parent company, Johnson & Johnson.

“The model used to determine the regulatory proceeds allocation was based on information collected by federal agencies for purposes independent of national prescription opioid litigation,” McMahon said. “Information regarding opioid use disorders was obtained from the US Department of Health and Human Services Substance Abuse and Mental Health Data Archive. “

Distributors will pay the state $ 21 billion over 18 years, while Johnson & Johnson (and Janssen) will pay up to $ 5 billion over nine years, including $ 3.7 billion in the first three years. Additionally, Johnson & Johnson and Janssen cannot sell opioids for 10 years, cannot fund, provide third-party subsidies, or lobby for opioids. They are also to share the test data as part of Yale’s open data access project.

According to the staff report, 70% of funds received by the state will be allocated to each eligible jurisdiction. Carlsbad’s share is projected at $ 1.6 million of the two settlements, according to McMahon. The distributor settlement is estimated at $ 1.3 million over 18 years and over $ 311,048 over nine years for Johnson & Johnson.

McMahon said the city had started receiving information on how the state would allocate the money at the end of October. However, the city has not been asked to provide the state with information on opioids specific to Carlsbad, although the allocation of funds is based on information gathered from federal agencies, according to McMahon.

The city has several options as to how to spend the money, including allocating a specific amount to the county or using it for “high impact reduction activities”.

If the city keeps its allocation, 50% of the funds received in each calendar year must be spent on these activities, such as matching funds or the running costs of establishments for substance use disorders under the Behavioral Health Continuum Infrastructure Program; create a new or expanded processing infrastructure; meet the needs of communities of color and vulnerable populations; division of persons from the judicial system in treatment; and the prevention of drug addiction among young people.

“California strongly supports continued investment in fighting the devastation suffered by our communities as a result of the opioid epidemic,” Gov. Gavin Newsom said in July. “The opioid epidemic continues to pose a serious threat to the health of Californians. In 2019, California saw nearly 12,000 opioid-related emergency room visits and more than 3,000 deaths. If approved, this settlement agreement would be a significant investment in opioid treatment and prevention. “