PRESENTER: Presenter
Valeria Acevedo, City Attorney
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SUBJECT: Title
Approval of a resolution of the City Council of the City of New Braunfels, Texas approving participation in a settlement agreement between the State of Texas and Opioid Manufacturers Alvogen, Amneal, Apotex, Hikma, Indivior, Mylan, Sun and Zydus; and authorizing the city manager to execute the Subdivision Settlement Participation Form.
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DEPARTMENT: City Attorney’s Office
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COUNCIL DISTRICTS IMPACTED: Citywide
BACKGROUND INFORMATION:
Texas is one of the lead states currently negotiating financial settlements with the nation’s largest companies in the opioid supply chain. On May 13, 2020, Texas, along with a broad, bipartisan coalition of states and subdivisions, reached two final agreements with four companies to resolve legal claims against for their role in the opioid crisis. In September 2021, City Council adopted the Texas Term Sheet as required by the settlement agreement and opted into those settlements with McKesson, Cardinal Health, ABCD, and Janssen/Johnson & Johnson, Endo/Par and Teva. (Resolution No. 2021-R-51). The city was awarded approximately $307,313.00. As with all payments, they will be made payable in varying amounts over an 18-year period. To date, the city has received 3 payments. The City received $96,471.88 on March 15, 2023, $18,767.90 on April 16, 2024, and $91,559.54 on April 1, 2025. These payments are available on the state’s website at: <https://comptroller.texas.gov/programs/opioid-council/funds/poli-sub-disbursements.php>
In 2023, the city opted into other settlement agreements with Allergan, CVS, Walgreen, and Walmart (Resolution No. 2023-R-26) from which the City expects to receive $289,592. On November 25, 2024, by Resolution No. 2024-R79, the City opted into the settlement with Kroger with the expectation of receiving a portion of those settlement funds which total $23,145.47.
Funds are to be used only to address opioid related harms and in accordance with the guidance provided by the 87th Legislature General Appropriations Act and Exhibit B of the Global Settlement Allocation Term Sheet dated May 13, 2020: <https://comptroller.texas.gov/programs/opioid-council/docs/texas-settlement-allocation-term-sheet.pdf>
At this time, there is a new settlement agreement between the State of Texas and opioids manufacturers, Alvogen, Amneal, Apotex, Hikma, Indivior, Mylan, Sun, and Zydus. In order to participate, the City Council must opt in and authorize the city manager to execute and submit the Subdivision Participation Form that is attached to this agenda item by the deadline of October 8, 2025. These funds will be paid out over a period not to exceed 10 years. Here is more detailed background provide in a notice sent to the City of New Braunfels:
SETTLEMENT OVERVIEW
Proposed nationwide settlement agreements (“Settlements”) have been reached that would resolve opioid litigation brought by states, local political subdivisions, and special districts against eight (the “Manufacturers”). Local political subdivisions and special districts are referred to as “subdivisions.”
The Settlements require the settling Manufacturers to pay hundreds of millions of dollars to abate the opioid epidemic. The Settlements will provide a maximum of approximately $720 million in cash to participating states and subdivisions to remediate and abate the impacts of the opioid crisis. Depending on participation by states and subdivisions, the Settlements require:
• Alvogen to immediately pay up to approximately $19 million;
• Amneal to pay up to approximately $74 million over 10 years, and to provide either approximately $177 million of its generic version of the drug Narcan or up to an additional approximately $44 million in cash;
• Apotex to immediately pay up to approximately $65 million;
• Hikma to immediately pay up to approximately $98 million, and to provide either approximately $35 million of its naloxone product or up to an additional approximately $7 million in cash;
• Indivior to pay up to approximately $75 million over five years, a portion of which, at the election of the state, could be paid in the form of Indivior’s branded buprenorphine and/or nalmefene products with a value of up to $140 million.;
• Mylan to pay up to approximately $290 million over nine years;
• Sun to immediately pay up to approximately $32 million; and
• Zydus to immediately pay up to approximately $15 million.
The Settlements also contain injunctive relief governing opioid marketing, sale, distribution, and/or distribution practices and require the Manufacturers to implement safeguards to prevent diversion of prescription opioids.
Each of the proposed settlements has two key participation steps.
First, each eligible state decides whether to participate in each Settlement. A list of participating states for each settlement can be found at <https://nationalopioidsettlement.com/>.
Second, eligible subdivisions within each participating state decide whether to participate in each Settlement. The more subdivisions that participate, the more funds flow to that state and its subdivisions. Any subdivision that does not participate cannot directly share in any of the settlement funds, even if the subdivision’s state is settling and other participating subdivisions are sharing in settlement funds. If the state does not participate in a particular Settlement, the
subdivisions in that state are not eligible to participate in that Settlement.
WHO IS RUBRIS INC. AND WHAT IS THE IMPLEMENTATION ADMINISTRATOR?
The Settlements provide that an Implementation Administrator will provide notice and manage the collection of participation forms. Rubris Inc. is the Implementation Administrator for these new Settlements and was also retained for the prior national opioid settlements.
WHY IS YOUR SUBDIVISION RECEIVING THIS NOTICE?
Your state has elected to participate in one or more of the Settlements, and your subdivision may participate in those Settlements in which your state has elected to participate. This notice is also sent directly to counsel for such subdivisions if the Implementation Administrator has their information.
If you are represented by an attorney with respect to opioid claims, please contact them. Subdivisions can participate in the Settlements whether or not they filed a lawsuit or are represented.
WHERE CAN YOU FIND MORE INFORMATION?
Detailed information about the Settlements, including each settlement agreement, may be found at: <https://nationalopioidsettlement.com/>. This website also includes information about how the Settlements are being implemented in most states and how funds will be allocated within your state.
You are encouraged to review the settlement agreement terms and discuss the terms and benefits with your counsel, your Attorney General’s Office, and other contacts within your state. Information and documents regarding the Settlements and your state allocation can be found on the settlement website at <https://nationalopioidsettlement.com/>.
Your subdivision will need to decide whether to participate in the proposed Settlements, and subdivisions are encouraged to work through this process before the October 8, 2025 deadline.
ISSUE:
In order to receive settlement funds under the Purdue Pharma L.P. and Sackler Family Settlement Agreement with the State of Texas, the City Council has to opt in no later than October 8, 2025.
STRATEGIC PLAN REFERENCE:
☐Economic Mobility ☐Enhanced Connectivity ☐Community Identity
☐Organizational Excellence ☒Community Well-Being ☐N/A
[Enter Objectives/Performance Measures Supported]
FISCAL IMPACT:
The amount of funds the city stands to receive under this settlement agreement is unknown until the State of Texas knows how many cities will participate. The use of funds is limited to the prevention, detection, abatement, and treatment of opioid abuse.
Recommendation
RECOMMENDATION:
Staff recommends approval in order to receive settlement funds.