A U.S. appeals court upheld a controversial New York state law to require drug makers and distributors to fund a program for covering costs for treatment, prevention, and recovery related to the opioid crisis.
Under the Opioid Stewardship Act, which was enacted three years ago, any manufacturer or wholesaler licensed to sell or distribute opioids in New York would pay a collective $100 million a year into a fund. At the time, state officials estimated that $600 million in surcharges would be collected over a stipulated six-year period.
The law marked the first time a state government sought to tax these companies as a way to fight the opioid crisis and cover associated expenses apart from filing lawsuits, most of which are still playing out in various courts around the country. In New York, the cost of addressing the opioid crisis was $200 million in 2017, twice what the state spent in 2011, according to court documents.
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