What opioid settlement funds will mean for affected Oregon communities

An estimated 5 Oregonians die every week from an opioid overdose. Two settlements from two different lawsuits mean the state is due to receive a combined $426 million for opioid treatment and prevention. We hear from Alex Cuyler, the intergovernmental relations manager for Lane County, and Wally Hicks, legal counsel for Josephine County, on how opioids affect their communities and what the money will mean for the future

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Note: the following transcript was computer generated and edited by a volunteer.

Dave Miller: From the Gert Boyle Studio at OPB, this is Think Out Loud. I’m Dave Miller. A lot of money is about to come to the state of Oregon for opioid treatment, about $425 million to be exact. It’s coming from two settlements with drug manufacturers and distributors. They were sued by cities, counties and states across the country as a way to hold them financially responsible for helping to create the opioid crisis. We’re going to get two perspectives now on the settlements and what they will mean for Oregonians, Alex Cuyler is the intergovernmental relations manager for Lane County. Wally Hicks is legal counsel for Josephine County. Welcome to you both.

Alex Cuyler / Wally Hicks: Thank you. Glad to be here.

Dave Miller: Wally Hicks, I want to start with Josephine County. Can you give us a sense for how your county has been affected by the opioid crisis?

Wally Hicks: I can. In the mid-1990s, when OxyContin was released to the market, there was an increase in the conduct that led to this, ultimately to this lawsuit into this settlement. To compound the situation in that era, when the spike in opioid availability occurred, there was a dramatic decline in the wood products industry in southern Oregon. So by 2012, Josephine County was plagued by the highest rate of opioid use in the state at nearly 300 prescriptions per 1,000 residents, and the statewide median In that year was about 234 prescriptions per thousand. So here in rural Oregon we saw the dramatic effects even more so than a lot of other places in the state.

Miller: What did that mean in terms of human lives in Josephine County and also the draw on county resources and, and county people?

Hicks: The over prescription of opioids has turned Josephine County into a magnet for criminals who are seeking drugs for illicit resale. The drive to obtain and use opioids fuels every category of criminal activity, thus virtually everyone in the justice system is either addicted to opioids or routinely interacting with opioid addicts and the largest increase in governmental expenditure that occurred around the time we filed this lawsuit with our peers in other counties, to fight crime had been approximately $7 million beginning in 2017, and that was spread over the course of the years since then, but that was just to increase jail capacity from 130 beds to 185, and we directly attribute the lion’s share of that to the opioid epidemic, and the over prescription of those led to it.

Miller: Alex Cuyler, what about Lane County? Can you give us a sense for how this sprawling county that includes Eugene, one of the biggest cities in the state and also a lot of parts of rural Oregon, how Lane County as a whole has been affected by the opioid crisis?

Cuyler: Sure, Dave. In 2014, Lane County was designated a high burden area for opioid misuse. We had that data through the reporting system established by the state for prescription drugs. And in 2015 to 2018 we really did a concerted effort to work with providers or prescribers to really work on making sure that they were making sure that prescriptions were more modest and thoughtful. We also really expanded our efforts to make sure that Naloxone – this is an anti-overdose drug – was accessible, including legislative policy addressing Naloxone use. But in spite of all that work, still and even through 2020, we had really, the higher burden of overdose deaths in the state of Oregon.

Miller: So let’s turn to the Johnson & Johnson settlement which is a really big one. It’s now going to mean that overall, between counties and the state, something like $330 million is going to come to Oregon. After that settlement was first announced, there was a pretty high stakes standoff between the State Department of Justice and Counties like the two of yours. Alex Cuyler, the state initially wanted to control 85% of the money in the settlement and only give local governments like yours 15%. Their argument, if I understand it correctly, the central argument was that centralized control over that money would lead to more coordination of services and fewer disparities in terms of who was getting help. What was the county’s counter-argument?

Cuyler: The counties felt pretty strongly, you’re right Dave, about that initial split, if you will. There were 12 local governments that participated in the lawsuit against these distributors, but the State Attorney General’s office came in because of the nature of the national settlement, and so there were a variety of different sort of plaintiff structures in place with the lawsuit. And we felt very strongly that since we had initiated the lawsuit; that, and the state had not been a party to this particular lawsuit, that it was inappropriate for the state to take the vast majority of the funds.

Miller: That seems like that makes sense in a fairness way. ‘Hey, we’re the ones who took this on, we won. So, you shouldn’t only give us 15% of the money, per capita,’ but I’m curious about and Wally Hicks, maybe you can take this on, not in terms of a fairness question, but in terms of a practical question; what do you think would have happened if the state had controlled the vast majority of this money? What would it have meant for people in Josephine County?

Hicks: It would have meant far less relief than what we’re going to get under the arrangement that we wound up reaching with the state. The thing is that the counties are, in Oregon, the local Public Health Authority, really are the ones who do the lion’s share of the work to battle the opioid epidemic, and to deal with the consequences that it involves. The counties have not only the public health function, and that of course involves such things as education and prevention, but coroner, medical examiner, law enforcement, of course, sheriff, jails, community corrections, parole and probation, and just a whole host of other impacts that the opioid epidemic has had directly on counties that really the state didn’t have to experience. So it was appropriate that we would continue negotiating that we got to a place that seemed fair to both sides and I think we did.

Miller: So instead of their initial offer of only 15% of the money going directly to counties, 55% will. What’s that going to mean in Josephine County? How much are you actually going to get over the next 18 years?

Hicks: Estimated at 2.9 million. And that’s just one settlement. We are anticipating, so I gather that the list of defendants in this case is something around 17 pages long and this is just five of them, and so we don’t intend to give up at this point. We plan to continue pursuing this case and perhaps getting settlements along these lines either from the US District Court that’s handling this or from bankruptcy courts or a combination from those. But yeah, we plan to keep on this until we get the full portion of justice that we can.

Miller: Alex Cuyler, what is this money in Lane County actually going to be spent on?

Cuyler: Dave, before I jump in on to that question, I did want to just clarify something as well, that the settlement arrangement that was ultimately decided upon will be distributed to all local governments over 10,000 population in the state of Oregon. So while there were just 12 local governments who were litigating counties, the benefit will accrue across to most local governments in the state. And I think that’s an important note to bring in. You know, we were also concerned by the idea of the state establishing a process to gain access to, if it had been 85% of the money in the state’s hands, that might have been more difficult for particularly smaller, local governments to apply into a state framework for receiving funding. But what we’re going to use the money on, let me get to that question. We do not have the money in our hands yet. So it’s still a little bit unclear, but I’ll give you a list of the kinds of things that our staff has already talked about. We would really like to build a behavioral health crisis center in our county. We think it’s something that’s desperately needed as an option to jailing people who have committed a crime, but they are obviously in some sort of mental health crisis. Some of that, a lot of that is drug fueled. And so we think that having an option to the jail, a crisis center would be a really good investment with some of these dollars. We also operate several school-based health care centers. We’d like to be able to ensure that we’ve got funding going to youth prevention programs. We have, like most local governments, really severe workforce issues, and workforce is an allowable use of the money and we also operate a medically-assisted treatment center. And I would like to be able to put some of the funding into that treatment center as well.

Miller: You’ve just described a lot of possible things that money could go towards. But you know, as we heard from Wally and Josephine County, the thinking is that this will mean around $3 million, but over a long time, the timeframe for this is 18 years. He did note that there are many other defendants, so more money could be coming. But in the end, it doesn’t seem like a huge amount of money going to any one locality. What am I missing?

Cuyler: As Wally said, there are some other settlement arrangements in the works, and those, my understanding is, are subject to the same kind of agreement that was established for this distributor settlement and then we also have the 45% that will go to the state of Oregon and then the last legislative assembly, there was a structure set up where those funds will be deposited in a framework for accessing those dollars as well. So, you know, there’s sort of two avenues of money, the money that will come directly and then the money that will be available through a yet to be determined application process. But it certainly will involve either grant or some sort of application process to the state of Oregon.

Miller: Wally Hicks, is this going to actually mean that more money overall is going to go to opioid treatment in Oregon, or could it be the case that in a county like Josephine County where for years we’ve talked about the fact that it’s been really challenging to adequately fund Sheriff’s Deputies or the jail or other health services, that you could end up taking money that was going to go towards drug treatment and now that could be backfilled from settlement money that could go towards something else?

Hicks:  I think there’s not an appetite to do that at this point. I don’t foresee one down the line either in terms of backfilling, taking the money from some other source. I think we wanna reinforce this anti-opioid epidemic effort in every way we can. You know, in terms of the amount of money, I think there’s a real interest among a lot of the cities and counties to partner up and combine their efforts in this and that would certainly increase the availability for any given program. You know, a lot of these programs, they don’t have to cost a whole lot of money to make a whole lot of difference and so, yeah, I think we are going to see an impact here, but this epidemic is so overwhelming and it’s not over. And I think the statistic is that last year, 2021 was the worst year yet for opioid casualties. So this is nowhere near the end. And we got to take all the resources we can and devote them appropriately.

Miller: I want to go back to the beginning. Wally Hicks, you noted that you were among the 12, I think counties in Oregon that brought suit starting a number of years ago. At that time, the model that people talked about was lawsuits against cigarette manufacturers and there were some parallels that seemed irresistible at the time and in terms of marketing and what these companies knew and then the devastation that eventually came from these products. Nevertheless, I’m curious if at that time, if you truly believed you’d be successful?

Hicks: Yes, we did. The evidence that was emerging from the very beginning of this was so compelling, and quite damning really for the big pharma companies that were doing all this overprescribing that yes; once we got to the point where we could really evaluate this case on the merits, as the evidence allowed, then yes, I was confident that we would prevail. I think tobacco is a good model in terms of the impact that money can have. I think that was on the scale and I’m not the person to quote, it was something like $54 million give or take, Alex might know that better than me. But it was something in that range that the state got. And look at the turnaround that’s occurred in tobacco addiction since then. And so, you know, we’re getting multiples more from this settlement than the tobacco settlement represented. And so if we spend the money, well, I think we could see a real impact.

Miller: Wally Hicks and Alex Cuyler, thanks very much.

Hicks / Cuyler: Thank you. Thank you, Dave.

Miller: Wally Hicks is legal counsel for Josephine County; Alex Cuyler is intergovernmental relations manager for Lane County.