California has joined national lawsuits against manufacturers, distributors, and other entities responsible for aiding the opioid epidemic and anticipates receiving funds from several opioid judgments. Monies from settlements and bankruptcies are provided to states, cities, and counties through different Fund Accounts pursuant to the relevant National Opioid Settlement Agreements, National Mallinckrodt Bankruptcy Plan, and Endo Public Opioid Trust Agreement. This page provides information for cities and counties regarding California's Opioid Settlements and Bankruptcies.
Opioid Settlement Oversight
California has reached final or proposed settlement agreements with the following opioid distributors and manufacturers:
- Distributors
- J&J
- Teva
- Allergan
- Walgreens
- Walmart
- CVS
- Kroger
California has named the Department of Health Care Services (DHCS) as the oversight and monitoring entity for funds received through the agreements listed above. Cities and counties are required to submit annual reports to DHCS for the above settlements.
The McKinsey Subdivision Settlement is separate from the National Opioid Settlements. DHCS does not oversee or monitor funds received through this agreement. Annual reporting to DHCS is not required for funds received from the McKinsey Subdivision Settlement. Information about the McKinsey Subdivision Settlement may be found on the settlement website
here. Additional questions should be directed to the city or county’s counsel or outside counsel handling their opioid-related matters.
California State Fund
Pursuant to Government Code, Title 2, Division 3, Part 2, Chapter 6, Article 2, Section 12534, the Opioid Settlements Fund (OSF) was created in the State Treasury. Funds from opioid settlements allocated to the state for opioid remediation shall be deposited into the OSF. Use of funds within the OSF are determined and appropriated by the California legislature and subject to normal state budgetary processes. Statewide activities funded by the OSF are limited to opioid remediation activities per the National Opioid Settlement Agreements.
For more information about California's statewide activities, visit the State Projects Page on the DHCS Opioid Response website.
California Abatement Accounts Fund
The California (CA) Abatement Accounts Fund was established to provide funds to cities and counties for the abatement of the opioid crisis in California. Participating cities and counties (otherwise known as Participating Subdivisions) receive funds from this account annually, as determined by the relative National Opioid Settlement Agreements. Payment periods vary by settlement and can last up to eighteen (18) years.
DHCS' oversight of the CA Abatement Accounts Fund includes, but is not limited to, conducting related stakeholder engagement, monitoring the Participating Subdivisions for compliance, and preparing annual reports. Payments from the CA Abatement Accounts Fund are made directly to Participating Subdivisions from the National Administrator, BrownGreer PLC, not DHCS.
California Subdivision Fund
The California (CA) Subdivision Fund was established to provide funds to cities and counties that were among the first to bring lawsuits and litigation against national opioid defendants (otherwise known as Plaintiff Subdivisions). Plaintiff Subdivisions receive annual disbursements from the CA Subdivision Fund as specified in the National Opioid Settlements Agreements. Payment periods vary by settlement and can last up to eighteen (18) years.
DHCS' oversight of the CA Subdivision Fund includes monitoring the Plaintiff Subdivisions for compliance with annual reporting requirements for the report prepared by DHCS. Payments from the CA Subdivision Fund are made directly to Participating Subdivisions from the National Administrator, BrownGreer PLC, not DHCS. DHCS does not collect information pertaining to backstop amounts withheld from the California Subdivision Fund. Plaintiff Subdivisions may reach out to their city, county, or outside counsel handling their opioid-related matters, for additional guidance.
NOTE: Plaintiff Subdivisions are included in references regarding “Participating Subdivisions" throughout the DHCS Opioid Settlements website.
California Bankruptcy Funds
California has reached final bankruptcy agreements with the following manufacturers:
- Mallinckrodt Plc
- Endo Pharmaceuticals
The California Mallinckrodt allocation agreement provides for direct payments to cities and counties that elected direct payment in the National Opioid Settlement with the Distributors. The Mallinckrodt allocation applies to funds from the Endo bankruptcy. Cities and counties that received direct payment from the Mallinckrodt bankruptcy received payment from the Endo bankruptcy. The Mallinckrodt bankruptcy involved two payments to eligible cities and counties. The Endo bankruptcy involved one payment to eligible cities and counties. No further payments are expected.
Cities and counties are required to report Mallinckrodt expenditures to DHCS annually. DHCS completes a report to the National Opioid Abatement Trust II, administrator of Mallinckrodt Funds, annually on behalf of the State (including counties and cities). No public or reporting to DHCS is required for Endo Pharmaceutical funds.
California State Share
Pursuant to the California Mallinckrodt Statewide Abatement Agreement, monies allocated to the State must be used on opioid remediation activities as listed in Exhibit 4 of the Mallinckrodt Bankruptcy Plan.
Pursuant to the Endo Public Opioid Trust Agreement, distributions received are intended to abate the opioid crisis and shall be substantially consistent with the programs and goals described in Exhibit 6.
The use of funds allocated from these agreements are determined and appropriated by the California legislature and subject to normal state budgetary processes.
For more information about California's statewide activities, visit the State Projects webpage on the DHCS Opioid Response website.
Local Government Share
California elected to distribute the majority of Mallinckrodt and Endo funds to participating cities and counties for opioid remediation activities at the local level.
Counties and cities are required to report Mallinckrodt expenditures to DHCS annually, which DHCS reports to the National Opioid Abatement Trust II (NOAT II). No public reporting is required for Endo. Payments to Local Governments are paid directly from NOAT II and Wilmington Trust, Endo Public Opioid Trust, not DHCS.
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Questions on Opioid Settlement and Bankruptcies
