Opioid Lawsuits On Par To Become Largest Civil Litigation Agreement In U.S. History

Recent months have seen a surge in opioid-related lawsuit filings against pharmaceutical companies and individual leadership of pharma companies, as well as retail pharmacies and dispensaries.

All in the name of holding opioid producers and distributors accountable for the current crisis gripping the nation.

Interestingly, what makes the actions of 2018 unique, is that very few of these suits were brought by victims or their families. Instead, they are being filed by cities, counties, state’s attorneys general and even Native American tribal councils. Each distinctive in the defendants named and rational.

While the Justice Department has joined states in their suits against opioid manufacturers, President Trump urged Attorney General Jeff Sessions to additionally file a separate federal lawsuit targeting specific drug companies.

However, collectively, it’s the state-level opioid lawsuits that are the most interesting, as they stand to possibly become the largest civil litigation settlement agreement in U.S. history. And while this is new territory for most of the plaintiffs and defendants, the concept and approaches are not new. In fact, they come directly from the current record holder’s playbook: Big Tobacco.

Precedence

During the 1990s, the U.S. was facing another public health emergency in the form of tobacco. Forty-six states and six jurisdictions subsequently entered into the present-day largest civil litigation settlement agreement in U.S. history with the tobacco industry.

That MSA set out that annual payments would be made by the participating tobacco manufacturers to recoup, “taxpayer money spent for health care costs connected to tobacco-related illness,” as well as set new standards and marketing restrictions for tobacco companies going forward. But the MSA also outlined that from the settlement date forward, states could not make future legal claims against tobacco companies that were included in the lawsuits associated with the MSA.

What makes this so significant in 2018, is that there are much better health records, pharma paper trails, and in theory, precedence for states receiving money they claim is owed to them through Medicaid and Medicare dollars that did not exist two decades ago.

Thus, all over the country attorneys general, advocates and doctors contend that tens of millions of dollars were intentionally spent by pharmaceutical companies to downplay addiction concerns, market exaggerated benefits of opioids, and lobby doctors to prescribe more. 

Given how closely this aligns with the Big Tobacco strategy, and rumors that the Department of Justice believes this to be true, these arguments of false advertising stand a good chance of being heard in the courts.

Other claims argue that it was the distributors (pharmacies at retail locations like CVS, WalMart and Walgreens) that actively misled and harmed consumers. Citing examples of counties and entire states like West Virginia that had more bottles of prescribed opioids than people who lived in the county, these cases might be on shakier ground. While it is true that pharmacists ultimately dispensed the drugs, only in certain states are they beholden to monitor the supply chain – in hopes of keeping opioids off the streets.

But the opioid situation is also different from Big Tobacco for a number of reasons, including that the drugs formally distributed had FDA approval, and in many cases, the resulting addiction led to combination drug usage. Consequently, it will be difficult to prove that individuals used the drugs as directed or that any one drug was wholly responsible.

However, with approaches ranging from recouping Medicaid dollars to suing an entire family that runs a pharma company to accusing pharma of allowing black market funneling of drugs, it is certain that at least a few of these lawsuits are going to play out in distinctive ways. In fact, at least one has already crossed international boarders – with a former employee of one company being sued while she works for a competitor in Europe.

Key Players

To date, there are more than a few interesting suits filed in relation to the opioid crisis. Here are some key plaintiffs and approaches that are making headlines :

  • States or counties in Mississippi, Ohio, West Virginia, Kentucky, Nevada, Texas, Florida, North Carolina, North Dakota, Tennessee, Illinois, New York and California have filed at least one suit against a pharmaceutical company or pharmacy for their active role in the opioid crisis. These are likely to move forward, and are likely to lead to marketing restrictions and a settlement agreement like Big Tobacco.
  • Everett, Washington’s Mayor filed a suit asserting that the heroin crisis in Everett is a direct result of Purdue Pharma, the makers of OxyContin, knowing the drug was being funneled onto the black market, and doing nothing to stop it.
  • Ohio’s Attorney General filed a lawsuit against Purdue Pharma, Johnson & Johnson and Teva Pharmaceuticals amongst others pharma companies. It claims that the pharma companies violated multiple state laws and that the state Medicaid program paid “excessive” costs for prescriptions of opioids. He also filed claims against four distributors stating, “We believe the evidence will show that these companies ignored their duties as drug distributors to ensure that opioids were not being diverted for improper use. They knew the amount of opioids allowed to flow into Ohio far exceeded what could be consumed for medically-necessary purposes, but they did nothing to stop it.” West Virginia and Ohio have admitted that they failed to enforce distribution supply monitoring, so it’s likely more suits like this will arise.
  • Cherokee Nation filed a lawsuit against pharmacies and distributors, including WalMart, CVS and Walgreens in Tribal Court over their role in the widespread harm prescription drugs inflicted on their tribe. After being rejected by a federal judge in Oklahoma, they have now sued Purdue Pharma for its role in opioid use amongst tribe members. The numbers presented in these cases were alarming, and the ultimate goal has been to combine the Cherokee Nation suit with others for a collective outcome.
  • Florida also sued drugmakers as well as drug distributors including Cardinal Health Inc. and McKesson Corp.The state is seeking damages for, “costs related to drug treatment, babies born addicted to opioids, state foster care services, law enforcement and other taxpayer expenses caused by the epidemic.”
  • Massachusetts has sued 16 individuals – including many members of the Sackler family – in relation to their roles in Purdue Pharma. Judy Lewent, Director at U.K. drugmaker GlaxoSmithKline (GSK) and Chair of its Audit and Risk Committee, has been named as a defendant in that lawsuit as well, dragging GSK into the mix, because of her U.S. role at Purdue until 2014. This particular case has taken many by surprise, and legal experts have weighed in across the board on how this might play out.

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