Vermont Gets a Disproportionate Amount of Pharma Settlements - The Reason is Not Good News

The state’s high per capita opioid death rate, elevated NAS rates, and rural vulnerabilities justify its robust proceeds.

Vermont, with its population of just 645,000, has been grappling with the opioid crisis, a struggle that has left deep scars across its communities. Recent headlines announced a $7.4 billion nationwide settlement with Purdue Pharma and the Sackler family for their role in the epidemic, with Vermont securing up to $21.85 million. For a state representing less than 1% of the U.S. population, this amount—roughly $33.86 per person—stands out, especially compared to Pennsylvania’s $212 million, or $16.21 per person, for its 13 million residents. Why does Vermont consistently receive such substantial shares from Big Pharma settlements? The answer lies in the disproportionate severity of the state’s opioid crisis, which, relative to its size, is among the nation’s worst.

A Landmark Settlement Reflects the Crisis

On June 16, Attorney General Charity Clark announced Vermont’s participation in the Purdue settlement, a step toward holding Purdue and the Sacklers accountable for their role in pushing OxyContin. The $21.85 million, pending bankruptcy court approval, won’t erase the pain of lost lives in Rutland, Bennington, or Burlington, as Clark acknowledged: “This settlement will never undo the suffering that has touched nearly every Vermont family.” Yet, it provides critical funds for treatment, prevention, and recovery programs, addressing urgent needs in a state hit hard by addiction.

This settlement follows a pattern. In 2021, Vermont secured $29.5 million from a $26 billion deal with Johnson & Johnson and drug distributors like Cardinal Health, McKesson, and AmerisourceBergen. In 2019, a $5.2 million settlement with McKesson addressed its role in oversupplying opioids. In 2022, Vermont received $2.7 million from a $573 million settlement with McKinsey & Company for its work with Purdue. Each time, Vermont’s share appears large relative to its population, reflecting the crisis’s outsized impact.

A Crisis That Hits Harder

The opioid epidemic has left a profound mark on Vermont. In 2018, the state recorded 127 opioid-related deaths, a rate of 22.8 per 100,000 people—well above the national average of 14.6 in 2017. By 2023, fentanyl had driven a nearly 500% increase in these deaths since 2010, according to the Vermont Department of Health. Beyond fatalities, Vermont faces one of the highest rates of neonatal abstinence syndrome (NAS), with 28.3 cases per 1,000 births in 2017, four times the national average of 7 per 1,000.

These figures highlight a crisis that, for a small state, feels universal. A 2023 state report noted that 1 in 10 Vermonters knows someone who died from an overdose. With a population so small, 127 deaths ripple through towns like St. Albans and Brattleboro, straining families, schools, and local services. This per capita burden explains why Vermont’s settlement shares are substantial.

How Settlement Funds Are Allocated

Opioid settlement funds are not divided by population alone but by the crisis’s severity. Formulas consider factors like overdose deaths, NAS rates, and the volume of prescription opioids shipped to each state. The 2021 distributor settlement, for instance, used such a model, and the Purdue settlement likely follows a similar approach, though its exact formula awaits court disclosure. This method ensures states like Vermont, with high per capita harm, receive proportionally larger shares.

A comparison with Pennsylvania illustrates this. In 2018, Pennsylvania’s opioid death rate was 23.8 per 100,000, slightly higher than Vermont’s 22.8. Yet, its $212 million Purdue share, for 13 million people, equates to $16.21 per person—less than half of Vermont’s $33.86. The difference reflects the settlement’s focus on per capita impact, which benefits smaller states where the crisis hits harder relative to population.

A Consistent Pattern Across Settlements

This trend extends beyond Purdue. In the 2021 Johnson & Johnson settlement, Vermont’s $29.5 million translated to $45.70 per person, nearly matching California’s $47.44 per person, despite its 39 million residents. The 2019 McKesson and 2022 McKinsey settlements further demonstrate Vermont’s ability to secure funds that, per capita, outpace those of larger states. These dollars are critical for a state with limited resources, where rural healthcare and recovery services are stretched thin.

The Stakes for Vermont

Vermont’s rural nature amplifies the crisis’s challenges. The state’s 2023 budget for opioid programs was just $12 million, far less than larger states can allocate. Settlement funds enable expansion of methadone clinics, naloxone distribution, and recovery support, especially in hard-hit areas like Morristown and Springfield. In these communities, where overdoses have shattered families, such resources can make a tangible difference.

Still, challenges remain. The $21.85 million from Purdue, and even the $60 million-plus from all settlements combined, can’t fully address a crisis estimated to cost the U.S. $1 trillion. Transparency in how funds are spent is also critical. A 2024 report by the National Academy for State Health Policy found Vermont allocated 85% of its 2021 settlement to treatment and prevention, a strong start, but ongoing oversight is needed to ensure effectiveness.

A Fair Share for a Deep Wound

Some might question whether Vermont’s shares are disproportionately large compared to bigger states. But the data tells a different story. The state’s high per capita opioid death rate, elevated NAS rates, and rural vulnerabilities justify its robust proceeds. Settlement formulas, designed to prioritize harm over population, ensure Vermont receives what it’s owed for the damage inflicted by Big Pharma, from Purdue’s OxyContin to distributors’ pill pipelines.

As Attorney General Clark stated, Purdue and the Sacklers “created and perpetuated a crisis that has stolen the lives of our loved ones, neighbors, and community members.” Vermont’s settlement funds, hard-earned and fairly allocated, are a tool to rebuild. In a state where the opioid crisis has left no town untouched, these dollars are not just compensation—they’re a lifeline for communities fighting to heal.