Image: High Cost of Medicine (dollar), by Markus Mainka, Canva
With many lawsuits already settled and others held up due to bankruptcy cases, money from the nationwide opioid settlements has been flowing to states and localities, including Washington and Greene Counties. Here are some of the latest updates:
- Drugmaker Mallinckrodt filed for a second bankruptcy that will likely pull $1 billion from their previous $1.7 billion agreement.
- The lawsuit involving Purdue Pharmaceuticals is pending a bankruptcy deal. On December 4th of last year, the Supreme Court heard oral arguments regarding this deal.
- In 2022, Rite Aid settled for up to $30 million to resolve lawsuits alleging pharmacies contributed to an oversupply of prescription opioids. Then, in October 2023, the company filed for bankruptcy, seeking to address its high debt, shut down underperforming retail locations, and sell off non-core business units. In January, Rite Aid received approval from bankruptcy court to sell its pharmacy benefit company, Elixir. Last month the company reached a bankruptcy settlement with its lenders, the U.S. Department of Justice, and drug supplier McKesson Corp. Shareholders now need to vote on the bankruptcy plan, and the bankruptcy court needs to approve the restructuring plan. This is likely an easy path on a road to avoiding a payout for the opioid settlement.
County Spending Update
March 15th was the annual deadline for counties to report how they have been spending their share of the funds received from opioid settlement funds. This reporting deadline was waived last year. Counties will need to report all expenditures for the period September 1, 2022 through December 31, 2023. Many counties have been usure of what to do with the funds and may need more time to spend them. They will have the option to request a 6-month extension when completing their annual report.
These reports will be submitted to the Pennsylvania Opioid Misuse and Addiction Abatement Trust, which is responsible for reviewing how the counties are spending the funds to ensure they are being spent the way they were intended to be. The Trust holds the power to pause and pull funds from counties that are misusing them. It is crucial that counties refer to Exhibit E when planning expenditures if they would like to continue receiving funds for the next 18 or so years.
The information in the reports should be made available to the public so that they can both assess how their county is spending the funds and hold them accountable if needed. However, it is unclear if this will happen. The members of the Trust have made a plan to meet in private working groups to review the expenditure reports and then submit recommendations to the board.
This plan was developed at the Trust’s February public meeting, where it was said that this is proper practice under the Sunshine Act.The Sunshine Act defines an agency as both the body “and all committees therefore authorized by the body to take official action or render advice on matters of agency business” for a wide range of public entities. Also, the court order from the Commonwealth Court creating the trust states that the “proceedings and meetings of this Trust shall be governed by the Sunshine Act.”
In a press release from Thursday, March 21st, the Pennsylvania Opioid Abatement Trust reported that all 67 PA counties and subdivisions have already spent or committed more than $70 million of the more than $102 million that the Trust has already distributed before December 2023. These preliminary calculations are based on the first annual reports from recipients of these funds, including all 67 counties and subdivisions across the Commonwealth.
The Trust notes that all reports and data have not been fully reviewed or approved by the Trust as to technical or substantive compliance. Because of the large number of programs, the Trust will develop small working groups to review the reports during the month of April. They will then hold a public meeting where they report the information to the entire Board of Trustees for action.
CCJ is currently reviewing the expenditure reports for both Washington and Greene Counties and will be providing an update soon on their spending. For further information, please reach out to our Community Organizer Paul Fedore at 412-229-7333 or paul@centerforcoalfieldjustice.org.
