States Announce $26 Billion Settlement to Resolve Opioid Lawsuits

States unveiled a historic $26 billion settlement with drug companies to resolve thousands of opioid-crisis lawsuits, paving the way for communities across the country to secure a jolt of funding to address an epidemic in painkiller addiction that hasn’t abated.

The nation’s three largest drug distributors— McKesson Corp. ,AmerisourceBergen Corp. , and Cardinal Health Inc. —and drugmakerJohnson & Johnson have been negotiating the deal for more than two years, but Wednesday’s announcement signifies an important milestone that could clear the way for money to be received by states as soon as early next year.

States can’t use the money to fill general budget holes, as they did after a $206 billion deal with tobacco companies in the 1990s. Instead, the majority must be spent on social services to address the harms of opioid addiction, like treatment programs, education on how to dispose of pills and needles, and bolstered funds for first responders. One community may use it to help a large problem of addiction in the homeless population, while another may be more focused on opioid-addicted babies.