Trial Magazine

It would be difficult to overstate the breadth of the current opioid crisis: Opioid addiction is devastating our communities, and “overdose [is] now the leading cause of death for Americans under 50.”¹

But our civil legal system can be part of the solution. Below, we outline the role opium has played in history, the present epidemic, the manufacturers’ and distributors’ liability, the pernicious drug industry efforts to cripple the Drug Enforcement Administration’s (DEA) intended role and powers, and the status of the federal multidistrict litigation (MDL).

Opium’s Dangerous History

History clearly illustrates the danger of opium and opiates. Initially widely promoted as medicinal “miracle cures,” opium—used since prehistoric times—and morphine—an opiate first isolated in the early 1800s—became a growing medical and public health concern by the last half of the 19th century.² Britain infamously caused vast quantities of India-grown opium to be imported into Chinese territories, which was the subject of the Opium Wars.³ By 1881, one-third of the adult Chinese population in Singapore were addicted to opium.⁴

In 1874—on a “black day for both medicine and society”—a London pharmacist discovered how to manufacture the morphine derivative that Bayer later mass marketed to the public as heroin.⁵ The opium poppy had evolved from a comparatively crude natural drug to “an agent for one of the most insidious underminings of human society ever devised.”⁶ Recognizing opiates’ risks, international agreements were reached as early as 1912 in an attempt to control opiates and prevent non-medicinal use.⁷

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This historic understanding of opium and opiates, however, was erased by the 21st century. The drug industry successfully promoted the fiction that drugs with mechanisms similar to heroin were safe for widespread use at increasing doses.

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This historic understanding of opium and opiates, however, was erased by the 21st century. The drug industry successfully promoted the fiction that drugs with mechanisms similar to heroin were safe for ­widespread use at increasing doses. The amount of prescription opioids sold nearly quadrupled from 1999 to 2014—but without a corresponding increase in pain reported by patients.⁸

Today’s Deadly Drug Crisis

This has all contributed to “the ­deadliest drug crisis in American history.”⁹ The Centers for Disease Control and Prevention (CDC) reports that the number of overdose deaths involving opioids was five times higher in 2016 than in 1999.¹⁰ In the 12-month period ending October 2017, there were 68,400 overdose deaths in America.¹¹

The solution, however, is not as simple as curtailing prescriptions—prescription drugs are often the gateway to illegal drugs, such as heroin. The CDC has reported that people addicted to prescription opioids are 40 times more likely to be addicted to heroin¹² and that the rate of heroin overdoses more than tripled since 2010, from 1 per 100,000 in 2010 to 3.4 per 100,000 in 2014.¹³

The injuries caused by the opioid plague even extend to babies and toddlers. Children can ingest opioid pills, mistaking them for candy, and maternal opioid use has dramatically increased: Every 25 minutes, a baby is born who suffers from neonatal abstinence syndrome (opioid withdrawal).¹⁴

Abating the epidemic will require a wide array of resources, including collaboration among public health agencies, medical examiners and coroners, and law enforcement.¹⁵ As reported by the CDC, “efforts to improve safer prescribing of prescription opioids must be intensified.”¹⁶ Because these drugs are still being overprescribed, education—or rather, re-education— regarding opiates’ dangers is critical. A multipronged approach is required to protect people who are addicted from overdose and “other harms,” and expanded access to naloxone (an overdose antidote) and treatments such as medication and behavioral therapies are necessary.¹⁷ Integrated prevention services such as syringe service programs are also useful in preventing the spread of viral diseases.¹⁸

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The manufacturers also systematically overstated the benefits and trivialized the grave addiction dangers of long-term opioid use.

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Manufacturer and Distributor Liability

In a 2016 open letter to the nation’s physicians, Vivek H. Murthy, then-U.S. Surgeon General, connected the opioid crisis to “heavy marketing of opioids to doctors . . . [m]any of [whom] were even taught—incorrectly—that opioids are not addictive when prescribed for legitimate pain.”¹⁹ Complaints filed against prescription opioid manufacturers describe these companies’ successful marketing campaigns to mislead the medical community and the public by, among other actions, untruthfully asserting that the addiction risks of prescription opioids are low when used to treat chronic pain. The manufacturers also systematically overstated the benefits and trivialized the grave addiction dangers of long-term opioid use.

The complaints also outline how the manufacturers engineered a dramatic shift in how and when opioids are prescribed by doctors and used by the public. Prescription opioid manufacturers have already been fined hundreds of millions of dollars for misleading marketing, and three Purdue Pharma executives have pleaded guilty to criminal misbranding.²⁰

Breach of duty to operate a closed system. The wholesale distributors of opioids also have been named as defendants. AmerisourceBergen Drug Corp., Cardinal Health, Inc., and McKesson Corp.—the “Big 3”—dominate 85 percent of the market share for prescription opioid distribution, and their principal business is the nationwide wholesale distribution of prescription drugs.²¹

For public health and safety, Congress enacted the Controlled Substances Act (CSA) in 1970, creating a closed system of distribution specifically designed to prevent the diversion of legally produced controlled substances into illicit markets.²² Each drug manufacturer and wholesale distributor must register with the DEA, and to legally manufacture opioids, the manufacturer must receive express DEA authorization and cannot exceed the assigned quota.²³ The quota system was intended to bar diversion from legal trade by controlling the “quantities of the basic ingredients needed for the manufacture of [controlled substances], and the requirement of order forms for all transfers of these drugs.”²⁴

The wholesale distributors—created as protective middlemen between the manufacturers and the prescribers—then have a nondelegable duty to implement a system to detect suspicious orders, to halt suspicious orders, and to notify the DEA of suspicious orders.²⁵ The Big 3, however, failed to fulfill the one purpose for which their distributor role was created: to prevent diversion into illegal channels.

The federal government has fined McKesson $150 million for its failure to report suspicious orders in violation of federal law,²⁶ and Cardinal Health was fined $44 million for its failure to report suspicious narcotic orders to the DEA.²⁷ The U.S. Department of Justice and the DEA have investigated and settled actions against McKesson and Cardinal Health on multiple occasions,²⁸ and AmerisourceBergen has settled with state agencies under similar circumstances.²⁹

Lobbying Thwarts the DEA

In April 2016, Congress passed legislation that “effectively stripped the [DEA] of its most potent weapon against large drug companies,”³⁰ appearing to—in the words of the DEA’s Chief Administrative Law Judge—“completely eliminate the DEA’s ability to ever impose an immediate suspension on distributors or manufacturers.”³¹ The legislation’s timing is mind-boggling. By that time, “the opioid war had claimed 200,000 lives” with no end in sight.³²

Yet, heedless of the rising death toll, the drug industry invested $102 million to lobby Congress between 2014 and 2016, and political action committees representing the industry made large campaign contributions to legislators instrumental in passing the legislation.³³ As a senior DEA official described it, “the agency fought the bill for years in the face of growing pressure from key members of Congress and industry lobbyists. But the DEA lost.”³⁴

The MDL Is Moving Swiftly

The federal MDL was created on Dec. 5, 2017, with more than 700 cases pending before Judge Dan Polster in the Northern District of Ohio.³⁵ The plaintiffs include cities, counties, and states that allege that: “(1) manufacturers of prescription opioid medications overstated the benefits and downplayed the risks of the use of their opioids and aggressively marketed . . . these drugs to physicians, and/or (2) distributors failed to monitor, detect, investigate, refuse and report suspicious orders of prescription opiates.”³⁶

Causes of action include RICO violations and claims for violations of consumer protection laws and state laws analogous to the CSA, as well as common law claims such as public nuisance, negligence, negligent misrepresentation, fraud, and unjust enrichment.³⁷ One theory of RICO liability, for example, describes an enterprise among drug manufacturers, trade associations, and “opinion leader” physicians whom the manufacturers surreptitiously financed.³⁸ According to the allegations, the enterprise operated to conceal the dangers of opioids and to falsely exaggerate the benefits of opioid use. Another RICO cause of action involves the activities of the wholesale distributors and other participants in the opioid supply chain, which operated together to inflate the opioid quotas.

Relief sought. More than 90 percent of the MDL plaintiffs are government entities.³⁹ In general, they seek to recover past and future expenditures caused by the opioid epidemic—such as funding for education, treatment, and other measures necessary to abate opioid addiction—in addition to statutory relief.⁴⁰ As a general rule, the municipal plaintiffs do not seek personal injury damages on behalf of the residents within their borders.

We are developing a complete damages model for our clients in the MDL, but even existing estimates are sobering. The estimated total economic burden of prescription opioid misuse in the United States is $78.5 billion annually, including the costs of health care, lost productivity, addiction treatment, and criminal justice involvement.⁴¹

Having expressed concern that 150 Americans are dying daily from the opioid epidemic,⁴² Judge Polster is acting swiftly and has appointed three Special Masters: David Cohen, Francis McGovern, and Cathy Yanni.⁴³

On April 11, the first MDL management order set a trial date of March 18, 2019, for three Ohio cases involving Summit County, Cuyahoga County, and the city of Cleveland.⁴⁴ The MDL court also initiated motion practice for selected county cases from Florida, Michigan, and West Virginia, as well as cases filed by the state of Alabama and a sovereign Indian tribe.⁴⁵

Also on April 11, Judge Polster granted the plaintiffs a victory by ordering the DEA to produce full transactional data from its Automation of Reports and Consolidated Orders System (ARCOS)—a data collection system in which manufacturers and distributors report their controlled substances transactions to the DEA—for Alabama, Florida, Illinois, Michigan, Ohio, and West Virginia during the period from Jan. 1, 2006 to Dec. 31, 2014.⁴⁶

The requested data for these six states was produced on April 20, and can be used to demonstrate the specific distribution of prescription opioids into these states. On May 8, Judge Polster ruled that the ARCOS data for these six states “has proved to be extremely informative,” and he extended the reach of his production order to include all states and territories.⁴⁷

While similar to the tobacco cases—in that both addressed government struggles with a public health crisis caused by industry misrepresentations and malfeasance—the opioid litigation involves significantly more plaintiffs and defendants and a different regulatory framework. The tobacco litigation ultimately resulted in positive changes, including public education on the dangers of tobacco and a decrease in its use. Here, too, we hope that our legal system can be used to help provide desperately needed education, to help save lives, and to help restore our communities.

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J. Burton LeBlanc IV is a shareholder and S. Ann Saucer is counsel at Baron & Budd in Baton Rouge, La., and Dallas. They can be reached at bleblanc@baronbudd.com and asaucer@baronbudd.com.

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Notes

1. Katharine Q. Seelye, 1 Son, 4 Overdoses, 6 Hours, N.Y. Times (Jan. 21, 2018), https://tinyurl.com/yaycjcju.
2. Martin Booth, Opium: A History 15, 62–64 (1998); see Sam Quinones, Dreamland: The True Tale of America’s Opiate Epidemic 52–53 (2015).
3. See Quinones, supra note 2, at 52–53; Booth, supra note 2, at 339.
4. Booth, supra note 2, at 176. Since 1955, Singapore has executed 117 people for the crime of heroin possession. Id. at 345.
5. Id. at 77.
6. Id. at 79.
7. Id. at 182.
8. Ctrs. for Disease Cont. & Prevention (CDC), Opioid Overdose, Prescribing Data, CDC.gov (2017), www.cdc.gov/drugover dose/data/prescribing.html.
9. Maya Salam, The Opioid Epidemic: A Crisis Years in the Making, N.Y. Times (Oct. 26, 2017), https://tinyurl.com/yapn4oru.
10. CDC, Opioid Overdose, Understanding the Epidemic, CDC.gov (2017), www.cdc.gov/drugoverdose/epidemic/index.html.
11. Nat’l Ctr. for Health Statistics, Provisional Drug Overdose Death Counts, Table 1, CDC.gov (2018), www.cdc.gov/nchs/nvss/vsrr/drug-overdose-data.htm; see also Katharine Q. Seelye, As Overdose Deaths Pile Up, a Medical Examiner Quits the Morgue, N.Y. Times (Oct. 7, 2017), https://tinyurl.com/ycaccvx2.
12. See CDC, Today’s Heroin Epidemic, www.cdc.gov/vitalsigns/heroin/index.html.
13. See Rose A. Rudd et al., Increases in Drug and Opioid Overdose Deaths—United States, 2000–2014, 64 Morbidity & Mortality Wkly. Rep. 1378, 1379 (2016).
14. Julie Turkewitz, ‘The Pills are Everywhere’: How the Opioid Crisis Claims Its Youngest Victims, N.Y. Times (Sept. 20, 2017), https://tinyurl.com/y7eq9t77; Nat’l Inst. on Drug Abuse, Dramatic Increases in Maternal Opioid Use and Neonatal Abstinence Syndrome,  drugabuse.gov (2015), https://tinyurl.com/z936x7x.
15. See Rudd, supra note 13, at 1382.
16. Id. at 1381.
17. Id. The report provides: “To reverse the epidemic of opioid drug overdose deaths and prevent opioid-related morbidity, efforts to improve safer prescribing of opioids must be intensified. Opioid pain reliever prescribing has quadrupled since 1999 and has increased in parallel with overdoses involving the most commonly used opioid pain relievers. [The] CDC has developed a draft guideline for the prescribing of opioids for chronic pain to address this need. In addition, efforts are needed to protect persons already dependent on opioids from overdose and other harms. This includes expanding access to and use of naloxone . . . and increasing access to medication-assisted treatment, in combination with other therapies.” (internal citations omitted). 
18. Id. at 1381–82.
19. Vivek H. Murthy, U.S. Surgeon General, The Surgeon General’s Call To End the Opioid Crisis, Turn the Tide (Aug. 2016), http://turnthetiderx.org. 
20. See Barry Meier, In Guilty Plea, OxyContin Maker to Pay $600 Million, N.Y. Times (May 10, 2007), https://tinyurl.com/ya7xru8h; Press Release, U.S. Att’y, E. Dist. of Pa., U.S. Dep’t of Justice, Pharmaceutical Company Cephalon to Pay $425 Million for Off-Label Drug Marketing,  www.justice.gov (Sept. 29, 2008), https://tinyurl.com/ydfnl7yj.
21. See Ken Hall, Has Big Pharma Made America a Country of Opioid Drug Addicts?, Newsweek (Aug. 9, 2017), https://tinyurl.com/yavgr4b4; see also FTC v. Cardinal Health, Inc., 12 F. Supp. 2d 34, 37 (D.D.C. 1998).
22. See H.R. Rep. No. 91-1444 (1970), reprinted in 1970 U.S.C.C.A.N. 4566, 4572; see also Gonzales v. Raich, 545 U.S. 1, 12–14 (2005); 21 U.S.C. §§801, 821–824, 827, 880 (West through Pub. L. No. 115-140).
23. See 21 U.S.C. §§823, 842(b).
24. H.R. Rep. No. 91-1444, supra note 22, at 4590; see also Joseph T. Rannazzisi, Deputy Assistant Admin., DEA, Improving Management of the Controlled Substances Quota Process, Caucus on Int’l Narcotics Control (May 5, 2015), www.drugcaucus.senate.gov/sites/default/files/Rannazzisi%20Testimony_0.pdf.
25. See 21 U.S.C. §823(b)(1); 21 C.F.R. §1301.74 (West through May 10, 2018).
26. Press Release, Office of Pub. Affs., U.S. Dep’t of Justice, McKesson Agrees to Pay Record $150 Million Settlement for Failure to Report Suspicious Orders of Pharmaceutical Drugs, www.justice.gov (Jan. 17, 2017), https://tinyurl.com/he5atdv.
27. Press Release, Dist. of Md., U.S. Att’y’s Off., U.S. Dep’t of Justice, Cardinal Health Agrees to $44 Million Settlement for Alleged Violations of Controlled Substances Act (Dec. 23, 2016), https://tinyurl.com/yalrkh4w.
28. Joseph T. Rannazzisi, Deputy Assistant Admin., DEA, Curbing Prescription Drug Abuse in Medicare (June 24, 2013), https://www.dea.gov/pr/speeches-testimony/2013t/062413-rannazzisi-testimony.pdf.
29. See Eric Eyre, Cardinal Health, AmerisourceBergen Agree to Settle WV Pain Pill Lawsuit, Charleston Gazette-Mail (Dec. 27, 2016), https://tinyurl.com/y9gma244.
30. Scott Higham & Lenny Bernstein, The Drug Industry’s Triumph Over the DEA, Wash. Post (Oct. 15, 2017), https://tinyurl.com/y8n2ooxz; see also Ensuring Patient Access and Effective Drug Enforcement Act of 2016, Pub. L. 114-145, 130 Stat. 354 (2016).
31. John J. Mulrooney II & Katherine E. Legel, Current Navigation Points in Drug Diversion Law: Hidden Rocks in Shallow, Murky, Drug-Infested Waters, 101 Marq. L. Rev. 333, 347 (2017), https://tinyurl.com/y7tx5hnz.
32. Higham & Bernstein, supra note 30.
33. Id.
34. Id.
35. In re Nat’l Prescription Opiate Litig., 290 F. Supp. 3d 1375, 1378 (J.P.M.L. 2017). There were 718 cases in the MDL as of May 15, 2018. 
36. Id at 1378.
37. Id.
38. As described in the complaints, “Key Opinion Leaders” are doctors sponsored by the prescription drug companies for their pro-opioid messages and used to create the misperception that the legitimate medical profession favored a wider and less circumspect use of opioids.
39. This estimate is based on plaintiffs as of Mar. 8, 2018, up to and including Conditional Transfer Order No. 13. The transfer motion was limited to governmental entities; however, potential tagalong notices were subsequently filed for actions brought by individuals, consumers, hospitals, and third-party payors. In re Nat’l Prescription Opiate Litig., 290 F. Supp. 3d at 1379. 
40. Inter alia, RICO treble damages.
41. Curtis S. Florence et al., The Economic Burden of Prescription Opioid Overdose, Abuse, and Dependence in the United States, 2013, 54 Med. Care 901, 904 (2016). 
42. See Jan Hoffman, Can This Judge Solve the Opioid Crisis?, N.Y. Times (Mar. 5, 2018), https://tinyurl.com/ybvgg7sa. 
43. In re Nat’l Prescription Opiate Litig., Appointment Order, Doc. #69, No. 1:17-md-02804-DAP (N.D. Ohio Jan. 11, 2018).
44. In re Nat’l Prescription Opiate Litig., Case Management Order No. 1, Doc. #232, No. 1:17-md-02804-DAP (N.D. Ohio Apr. 11, 2018).
45. Id.
46. In re Nat’l Prescription Opiate Litig., Order Regarding ARCOS Data, Doc. #233, No. 1:17-md-02804-DAP (N.D. Ohio Apr. 11, 2018). More information about ARCOS can be found at www.deadiversion.usdoj.gov/arcos/index.html. 
47. In re Nat’l Prescription Opiate Litig., Second Order Regarding ARCOS Data, Doc. #397, No. 1:17-md-02804-DAP, 1 (N.D. Ohio May 8, 2018).