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Kenosha County Finance Committee approves terms for next round of opioid settlement payments with pharmaceuticals, distributors

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A Kenosha County panel has approved terms to receive the second round of payments from federal lawsuits it joined to hold pharmaceuticals and distributors responsible for their part in the national opioid epidemic.

The county’s Finance and Administration Committee has unanimously approved the terms of the agreement, which will go before the full County Board on Tuesday night.

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“This is now the second round – this is two smaller distributors, as well as three major pharmacy chains that have now reached a tentative agreement with the various municipal entities, governmental entities suing them,” said Joseph Cardamone, the county’s corporation counsel.

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An agreement has been reached with Teva and Allergan pharmaceuticals along with national distributors Walgreens, Walmart and CVS pharmacies, according to the resolution. The county is being represented by special counsel through von Briesen & Roper, S.C., Crueger Dickinson LLC and Simmons Hanly Conroy LLC in the opioid lawsuit.

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In 2017, the county joined the list of Wisconsin counties that filed separate federal lawsuits seeking to hold makers and distributors of prescription painkillers responsible for bringing about a nationwide opioid epidemic. The suits alleged drug manufacturers and distributors used deceptive marketing campaigns that misrepresented the safety of long-term opioid use and sought unspecified monetary damages for the financial strain caused by counties’ response to the epidemic.

In Wisconsin, with 87 counties and municipalities signed on, the lawsuit is estimated to yield more than $402 million including all parties, with nearly $282 million in payments to local governments, including $10 million over a period of 18 years to Kenosha County. Racine and Walworth counties are expected to receive just over $9 million and $4.4 million, respectively.

Two years ago, the county received $1.75 million in the first round of payments from settlements with McKesson Corporation, Cardinal Health Inc., AmerisourceBergen Corporation, Johnson & Johnson, Janssen Pharmaceuticals, Inc., Ortho-McNeil-Janssen Pharmaceuticals, Inc. and Janssen Pharmaceutica, Inc.

Kari Foss, the behavioral health manager for Kenosha County Division of Aging and Disability Services, said the first payout was “significantly higher” than the subsequent ones the county anticipates as settlements are reached. She said the final dollar amount will not be known until the “final gavel falls.”

Finance Director Patricia Merrill said with the latest settlement attorneys “have not given us final dollars as far as the county level.”

Under the terms of the settlement, the funds would be kept into an “opioid abatement” account, separate from the county’s general fund. About 20 percent would go toward attorney costs, according to Cardamone, an amount that was lowered from 25 percent. He said the special counsel is “making every effort to retrieve or recover as much of their fees as possible from a national settlement account in order to maximize the amount the participating municipalities get.”

The deadline for the county to sign on to the settlement is April 18. The soonest the county could receive the next round of payments would be by the end of summer. Cardamone said a more realistic expectation for funds would be in the third quarter or the end of the year.

Cardamone said Wisconsin has been a leader in how it distributes its opioid settlement proceeds as many other states have taken as much as 50% to 70% of the settlement payments. In Wisconsin, the state has agreed to recover just 30 % with the remaining 70% going to local governments and municipalities, he said.

“I really think it is probably the most generous split for the municipalities that I’ve seen, at least, in talking with my colleagues in other states,” he said. “We (Kenosha County) wind up getting about 3.7%, approximately, of the 70 % that’s going to local municipalities. That’s’ one of the top shares … which is great.

“It’s probably less great when you realize it’s probably because it’s based on how hard we’ve been hit. Nonetheless, from a purely dollar standpoint, it’s certainly very exciting for our ability to try and use these monies now for something beneficial,” he said.

Sarah Caldwell, 32, died from an overdose involving heroin in July 2020.

Auriel McNutt, 27, died from an overdose involving fentanyl in June 2020.

Steven Welnetz, 21, died from an overdose involving fentanyl in November 2021.

Erin Kjellstrom, 27, died from an overdose involving fentanyl in May 2020.

Abraham Bendorf, 20, died from an overdose involving fentanyl in February 2021.

Isaac Weires, 19, died from an overdose involving fentanyl in December 2020.

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