Government Suits Against Opioid Manufacturers as Public Health Policy

November 30th, 2017 by CHHS RAs

By CHHS Extern Joshua Prada

In recent years, the United States has been experiencing a major public health crisis in the form of an epidemic of opioid abuse. In 2015 alone, there were 33,091 drug overdose deaths involving opioids in the United States. These numbers represent a rate of overdose deaths more than 2.5 times higher than the rate in 1999. The potential for federal action to combat this epidemic has become a major political issue, with both candidates for President in 2016 making it a major issue of the campaign. The epidemic was back in the news recently when President Trump officially declared it a public health emergency.

Many state and local governments, however, have not waited for federal action to combat the opioid epidemic. Starting in 2014, state and local governments began suing opioid manufacturers under state laws prohibiting false and deceptive advertising. Over the past three years, numerous state and local governments have filed similar suits. The state of Ohio, the city of Everett, Washington, and the Cherokee Nation are only a few of the governments that have brought such suits.

The suits generally accuse opioid manufacturers of knowingly using false and deceptive information on the effectiveness and risks of opioids in their marketing material. Ohio’s lawsuit, for example, claims that the manufacturers “deceptively trivialized the risk of addiction, through a series of misrepresentations that have been conclusively debunked by the FDA and CDC” and “falsely and misleadingly touted the benefits of long-term opioid use and falsely and misleadingly suggested that these benefits were supported by scientific evidence.” The Ohio suit additionally accuses manufacturers of targeting “susceptible prescribers and vulnerable patient populations.”

In alleging that they have suffered an injury sufficient to support a lawsuit, state and local governments argue that the false and deceptive practices of opioid manufacturers have spurred the proliferation of opioid use, ultimately resulting in greater government expenditures, in the form of increased prescriptions and treatment costs paid for by Medicaid and other government programs. The Ohio suit lays much of the blame for the opioid epidemic itself on the manufacturers, arguing that the “dramatic increase in opioid prescriptions and use corresponds with the dramatic increase in Defendants’ spending on their deceptive marketing scheme.”

The legal theories advanced in these suits are very similar to those advanced by the states and the federal government in similar litigation against tobacco manufacturers in the 1990s. The states and the Justice Department alleged that the tobacco manufacturers violated the Racketeer Influenced and Corrupt Organizations (RICO) Act by knowingly making false statements to mislead the public about the dangers and addictiveness of nicotine. The litigation ultimately resulted in the Master Settlement Agreement (MSA), in which forty six states and six additional U.S. jurisdictions agreed to give up future legal claims based on the conduct at issue in the suits in exchange for annual payments in perpetuity from the four largest tobacco manufacturers and restrictions on advertising by those manufacturers. In addition to tobacco, there have been attempts by governments to utilize these types of arguments in actions against corporate polluters and lead paint manufacturers.

Although the litigation against tobacco manufacturers ultimately produced the largest civil settlement in United States history, some critics, including Professor Donald Gifford of the University of Maryland Carey School of Law, have argued that the MSA was not especially effective, either in terms of curbing smoking or compensating its victims. He notes that the settlement has forced states into the awkward position of partnering with the very tobacco manufacturers they sued and relying on their success to ensure continued payments under the MSA. Professor Gifford also questions whether the MSA provides any benefit to the actual victims of tobacco products. Professor Gifford concludes that legislation is a much more effective and appropriate means of addressing the public health problems caused by products like tobacco or lead paint.

Although legislation may be a more attractive solution than litigation, it is unlikely that this Congress will take significant steps to regulate opioids. While President Trump’s recent declaration has brought the opioid epidemic into the political spotlight, most observers agree that his action will have little practical effect. Lawsuits brought by state and local governments, therefore, may be the only way that opioid manufacturers are pressured to change their behavior. Assuming any of these suits gain traction, it will be interesting to see whether the Plaintiffs are able to devise new and innovative remedies that can avoid the pitfalls which critics have argued made similar litigation against tobacco and lead paint manufacturers inadequate from a public health policy perspective.

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