Minnesota takes step toward $337 million opioid settlement

BLOOMINGTON, Minn. (FOX 9) - Minnesota and its counties have reached a key deal toward unlocking a legal settlement with opioid distributors.

Attorney General Keith Ellison and the Association of Minnesota Counties have a framework on how to split up to $337 million over 18 years, the two parties said Monday. The money will come from a multi state settlement involving distributors McKesson, Cardinal Health and AmerisourceBergen and manufacturer Johnson and Johnson.

The state will keep 25 percent for its Opioid Response Advisory Council, while 75 percent will go to all counties and certain cities, under terms of the deal detailed to FOX 9. More than 5,400 Minnesotans have died from opioid overdoses, including 643 people in 2020 alone.

"The lion's share is going to local government because that's where the pain is," Ellison said in an interview. "The money has to go where the pain is. The money has to go where the overdoses were, where the ER burden was so heavy."

The framework is only one step; Minnesota only gets the full $337 million amount if its local governments agree to it and drop their own legal claims. Cities and counties face a Jan. 1 deadline. Without agreement within the state, Minnesota would forfeit some of the settlement.

Negotiations between county and state officials have been going on for weeks, mirroring a process in more than 40 other states.

A breakthrough in Minnesota came just in time to be announced at the Association of Minnesota Counties' conference Monday morning, in front of hundreds of county officials from around the state.

"Together we arrived at a settlement that works well for local governments that are responsible for getting these settlement dollars where they're needed most," said Rich Sve, a Lake County commissioner and president of the statewide association.

Agreement with the counties was a big hurdle because all 87 of them stand to get a piece of the settlement. Cities with more than 30,000 people, have their own health departments, or had pending opioid litigation will also be eligible, Ellison said.

But all county boards and city councils party to the deal must still hold yes votes by the deadline.

"It's going to be the most benign harassment you've ever seen," Ellison said. "We're going to be like, 'We need this, we need it now. Let's get it done.'"

The settlement with the big three distributors and J&J is separate from an accord involving opioid manufacturer Purdue Pharma. Minnesota stands to get $50 million over nine years from that case. The same framework could be applied to the payments from Purdue if municipalities agree to it, Ellison said.

Ellison credited a working group and several state lawmakers for contributing to this fall's negotiations. Two Minnesota lawmakers involved in the effort, state Rep. Dave Baker, R-Willmar, and state Sen. Chris Eaton, DFL-Brooklyn Center, have lost children to opioid overdoses.

The settlements, if approved, will eliminate fees that Minnesota lawmakers authorized on opioid companies in 2019. The fees, which had brought in about $15 million a year to the state's Opioid Response Advisory Council, would end once Minnesota collects $250 million in settlements.