The settlement negotiated by Pennsylvania Attorney General Josh Shapiro and other state AGs ultimately won Philadelphia's buy-in before a midnight deadline Wednesday, after months of pushback from Mayor Jim Kenney and District Attorney Larry Krasner, who had argued the settlement amount was too low, and its 18-year payout schedule too long, for a city among those hit hardest by the drug epidemic.
Philadelphia's share comes to at least $186 million, according to the AG's office. The mayor's office said the city will receive additional funding "due to the scale of the impact and devastation that the opioid epidemic has wrought on the city and our residents." But officials didn't immediately say how much.
The city and Krasner's office each filed lawsuits against drugmakers and distributors — and Krasner confirmed Thursday he did not join the settlement and will continue to pursue his case.
Funding from what Shapiro called a "historic agreement" will begin flowing as soon as April "to jumpstart programs and ramp up staffing to save the lives of those struggling with opioid addiction," the attorney general said in a statement Thursday. "This agreement marks the most significant influx of resources to our Commonwealth to address this epidemic, jet-fueled by greedy pharmaceutical companies."
National Deal on Opioids
The distributors said in a joint statement last month that they "remain deeply concerned about the impact the opioid epidemic is having on communities across the nation and remain committed to being part of the solution." Johnson & Johnson has said the crisis is a "tremendously complex public health issue," and that it stopped selling prescription opioids in the U.S. as part of "ongoing efforts to focus on transformational innovation."
In the Philadelphia region, the four suburban counties will receive up to $147.7 million combined, the AG's office said.
The maximum payouts possible break down as: $45 million for Bucks, $19.2 million for Chester, $48.5 million for Delaware, and $35 million for Montgomery.
How Counties Will Use the Money
Delaware County was first to file an opioid lawsuit against drug companies in 2017 in state court. The county will also receive some additional money from a $30 million pool because of its work on opioid litigation. Philadelphia is receiving $13 million from the pool, which counts toward the $186 million settlement share. Carbon County will get a portion of this pool, too.
"Especially during this pandemic. when we see overdose deaths increasing once again, we think we can use these resources to save people's lives," Delaware County District Attorney Jack Stollsteimer said in a recent interview. His office sued drug companies in 2019.
Opioid Addiction Stories
Spokespeople for Bucks and Montgomery counties did not elaborate on plans yet for the settlement funds.
A previous national deadline for municipalities to sign up by Jan. 2 was extended to Jan. 26 — and the number of participating Pennsylvania counties crept up over the last month, from 47 counties as of Dec. 29, to all 67 counties by Wednesday night.
Shapiro had urged Pennsylvania municipalities to give up their legal fights in exchange for guaranteed settlement funding to combat the epidemic. His office pointed to recent setbacks in litigation elsewhere: last fall the Oklahoma Supreme Court reversed a ruling for a $465 million verdict against Johnson & Johnson, while in California cities and counties lost a case against drugmakers at trial.
The settlement money is to be used for programs and services such as treatment of opioid use disorder, distribution of medication like Naloxone to reverse overdoses, and educational outreach to prevent the over-prescribing of opioids, and discourage misuse.
Narcan Dispensers Will Be Installed in West and South Philadelphia
Reaching the state's maximum $1 billion dollar payout has depended on how many municipalities join: the more that do, the more money comes into the state. Shapiro said Pennsylvania is on track for that with support from all counties.
While the total is payable over 18 years, about a quarter of the funds — $232 million — are scheduled to come in year one.
Philly Officials Lambasted the Deal
Mayor Kenney and DA Krasner had criticized the settlement proposal since it was first announced last July, saying the city wouldn't get enough money under the deal.
A spokesperson for the mayor told The Inquirer last month the city would "not agree to such a minimal amount of money over a long period of time—and incongruent to the scale of the damage inflicted."
In 2020, the city had its second-highest death toll on record from drug overdoses: 1,214 people were killed and 86 percent of those deaths involved an opioid.
Krasner's suit is one of just four bellwether cases in the state that would see trial first, though no trial date has been set. The complaints are among dozens of lawsuits filed statewide that are being coordinated in the Delaware County Court of Common Pleas.
Krasner also sought to safeguard his opioid case during the settlement process. He sued Shapiro's office last summer and asked the state's Commonwealth Court to rule that the attorney general cannot, as part of the settlement, sweep away the district attorney's claims against companies.
Shapiro's office contended the district attorney doesn't have authority to sue the attorney general, and that the case was premature while settlement sign-ups were ongoing.
A panel of judges heard arguments on the matter in December and a decision is pending.
"Sadly there is nothing new about American government selling out to money and power against the interests of the most vulnerable Americans," Krasner said Thursday. "We as a society can do better. The fight continues."
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