From Kelley Drye’s Pharmaceutical Litigation Group

According to almost every major media outlet, America is now in the midst of an opioid addiction crisis. People across the U.S. are developing dependencies, and even overdosing, on opioids: drugs like OxyContin, Hydrocodone, Fentanyl, Morphine and Heroin. On August 10, 2017, President Trump called it a national emergency.

One of the newer symptoms of this so-called “Opioid Epidemic,” however, is a rash of litigation targeting pharmaceutical manufacturers and distributors. Currently, there are actions underway in Texas, West Virginia, Alabama, Ohio, Mississippi, South Carolina, Kentucky, Washington, Illinois, California, New York and more new suits are being filed almost daily.

The overarching assertion in these suits is that various pharmaceutical companies have downplayed the risks associated with chronic opioid use, including dependency, and exaggerated the effectiveness of their abuse-deterrent tools. At the same time, they are accused of overstating the benefits of opioids as a treatment for chronic pain, often using as a mouth-piece third-party scientists and researchers who manipulate targeted patients and doctors.

Current Litigation

The present actions filed against these brand-name pharmaceutical companies and their affiliates are based on theories of fraudulent marketing.

These companies are facing common law tort and statutory claims, among them consumer and Medicaid fraud, public nuisance (criminal acts that threaten the welfare of the community), unjust enrichment (benefiting unfairly from another’s loss), false advertising, deceptive practices, corruption and civil conspiracy.

In September, former trial lawyer Richard Scruggs wrote an article in Law360 likening this spate of lawsuits to the Big Tobacco cases of the mid-90’s. Scruggs’s article, and others like it, tend to over-emphasize the similarities and ignore many of the vital distinctions between the current suits and the Big Tobacco cases. Still, there is one over-arching factor that has proven critical to both opioid and tobacco litigation--the political nature of the claims. State Attorney Generals and regulators are using their home forum to transform plaintiffs’ cases of questionable merits into formidable litigation. The presence of government players adds value, irrespective of the lawsuit’s objective merit. As such, the potential gravity of these lawsuits is hard to dismiss.

The tobacco cases eventually resulted in billions of dollars in settlements.

Future Generic Exposure

For now, the defendants in these suits are nearly all brand companies like Endo International Plc and Janssen Pharmaceuticals. But, despite the fact that the current cluster of charges seem to apply solely to brand name ventures, parties on both sides of litigation are looking pointedly towards manufacturers of generics.

Purdue has been one of the principal targets for its role in marketing OxyContin and Hyslinga. Defending the charges against Purdue in Bloomberg, the company’s media representative, Robert Josephson, pointed out the relatively small opioid distribution percentage attributable to pharmaceutical name brands. He described generic manufacturers of opioids as the “biggest players around,” without whom the opioid “problem” would not be solved. In the same piece, former Mississippi Attorney General Mike Moore, who spearheaded the Big Tobacco cases and is now handling the Ohio-Mississippi suits, pledged that: “when all is said and done, all the companies will be sued one way or the other.” The Illinois suit, City of Chicago v. Purdue Pharma, named among its defendants generic manufacturer Actavis Generics, a subsidiary of Teva International.

Defensive Strategies

Pharmaceutical companies can defend themselves.

In each of these claims, specific acts and specific harms attributable to actual elements of causation must be determined. This is difficult to do when the quality of the ostensible harm, the full diasporic spectrum of the “epidemic,” is so variable. Furthermore, there are a plethora of intervening actors between pharmaceutical companies and the community, any of whose independent behavior could supersede and break the causal chain required to hold opioid manufacturers liable. For example, doctors who negligently mis-prescribe or miscommunicate, and patients who misuse opioids electively, or as a result of other social forces, divert any legally constructed flow of responsibility connecting the manufacturers and their advertising to the conditions that created the health crisis.

In fact, it is believed that more than 2 million people abused opioids in 2016, costing the government more than $25 billion in health care costs allocated to addressing this addiction. But so much about the actual roots of the epidemic are just now being discovered. Studies conducted by the University of Arkansas looking at the transition from acute to periodic opioid use seem to suggest that the most effective way of reducing the risk of abuse might be through doctors limiting initial prescriptions, leaving shorter periods of time between refills, and so preventing unnecessary accumulation of medication.

Keeping You Updated

In service to clients who may find themselves affected by this new legal trend, the lawyers at Kelley Drye & Warren LLP will be carefully analyzing the wide range of published research addressing the causes and effects of the “Opioid Epidemic,” with a view to anticipating and blunting some of the most spurious charges.

As the body of research grows, and the opioid litigations develop, we will publish regular advisories detailing precautionary steps that can be taken at the pre-litigation stage, in addition to considering how best to craft the most viable defenses. We have created a tracking chart classifying each legal development in this area which will be used to keep us, and you, up-to-date and to spot developing trends as they happen.

Let us know if you’d like to continue receiving updates from us as the Opioid Litigation Epidemic develops.

Contacts:

Bill Escobar
(212) 808-7771
wescobar@kelleydrye.com

Neil Merkl
(212) 808-7811
nmerkl@kelleydrye.com

Cliff Katz
(212) 808-7609
ckatz@kelleydrye.com

Preparing for the Opioid Litigation Epidemic