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Sanford Heisler Sharp LLP | 20th Anniversary 2004 - 2024

The Opioid Epidemic: Its Causes and How Communities Can Fight Back

On Behalf of | August 7, 2018 | Civil Litigation

America is experiencing an opioid epidemic that has resulted in economic, social and emotional damage to virtually every community in the United States and tens of thousands of Americans. It is indiscriminate and ruthless, and kills 175 Americans every day. In 2016, more than 64,000 people died of drug overdoses (and the majority of these deaths were related to opioids). That is the equivalent of a plane with 175 passengers crashing and killing everyone on board every day for an entire year.

The devastating impact of opioid abuse cannot be overstated. After years of decreasing death rates in the United States, death rates are on the rise, fueled by an increase in opioid-related drug overdose deaths. Drug overdoses are now the leading cause of death for Americans under the age of 50. The number of Americans who die of drug overdose deaths this year will roughly equal the number of Americans who died in the Vietnam, Iraq, and Afghanistan wars combined.

The opioid abuse epidemic sweeping this nation was not an accident. Rather, it was caused by a fraudulent marketing scheme hatched in the corporate boardrooms of some of America’s largest drug manufacturers. Several of the largest pharmaceutical manufacturers in the country devised a plan to promote prescription opioids—highly addictive narcotics—as an appropriate analgesic for patients suffering from chronic pain. The pharmaceutical manufacturers aggressively carried out this multi-year, national campaign to mislead unsuspecting doctors and consumers about the inherent risk of addiction associated with opioids.

Even though the pharmaceutical manufacturers knew that opioids were historically used only to treat short-term acute pain or for palliative care, the prospect of big profits overrode concerns about fomenting an addiction crisis. They initiated a large-scale marketing campaign in the late 1990s to persuade doctors and patients to use opioids for chronic pain such as back pain, arthritis, joint pain, and migraines. The pharmaceutical manufacturers spent, and continue to spend, millions of dollars on promotional materials and activities designed to falsely deny or trivialize the risks of opioids while overstating the benefits of opioids for patients with chronic pain. They disseminated medical propaganda directly through their sales representatives and indirectly through third-parties, including physicians known to be on Big Pharma payrolls (“key opinion leaders”) and professional and advocacy groups (“front groups”) funded by the pharmaceutical manufacturers themselves. Pharmaceutical manufacturers engaged in this campaign with the purpose of changing the commonly held and scientifically based understanding of opioids so that doctors and patients would feel comfortable using these dangerous narcotics.

The pharmaceutical manufacturers’ efforts to mislead the public have resulted in a windfall of profits. Opioids are now the most prescribed class of drugs; they generated $11 billion in revenue for drug companies in 2014 alone. While Americans represent only 5 percent of the world’s population, they consume 80 percent of the world’s production of opioids.

While the pharmaceutical manufacturers collected billions of dollars in revenues because of their deceptive acts, widespread opioid abuse has devastated patients, families, and communities. Many large pharmaceutical distributors further facilitated opioid abuse by failing to monitor the drug supply chain and stem the diversion of opioids to the black market.

The pharmaceutical manufacturers were not alone in their responsibility for causing and exacerbating the opioid crisis. Companies that distribute prescription drugs could have and should have better stemmed the excess flow of opioids into Virginia. Drug distributors receive opioids from drug manufacturers and transfer the opioids to hospitals, pharmacies, doctors, and other healthcare providers who then dispense the drugs to patients. Distributors are supposed to play a monitoring role in the drug delivery system by refusing to fill suspicious orders and reporting suspected drug diversion to authorities. The drug distributors ignored these responsibilities. When presented with the opportunity to make record profits by distributing steadily increasing amounts of opioids into communities across the nation, distributors chose profits over ethics and unleashed a cycle of addiction and death. Even though the distributors knew there were obvious problems in their supply chains, such as unusually large orders from small pharmacies or orders from physicians with a known reputation for engaging in drug diversion activities, the distributors continued to push opioids into communities.

The scheme to push opioids into American communities could not have been successful had the controlled substances at issue not been paid for, reimbursed, or covered by public and private pharmacy benefit plans. Pharmacy Benefits Managers (PBMs) are the gatekeepers to the vast majority of opioid prescriptions filled in the United States. PBMs, such as Caremark, Express Scripts, and Optum Rx, reimburse between 80% and 95% of all prescriptions written in the United States. PBMs control drug formularies which set the criteria and terms under which pharmaceutical drugs are reimbursed. In this way, PBMs control prescription drug utilization overall.

PBMs’ complicity in the overall fraudulent scheme is likely intentional given the nature of the financial arrangements between PBMs and drug manufacturers and others in the supply chain. Drug manufacturers compete for PBM formulary placement (preferred placement results in greater utilization) and create incentives to keep certain drugs on and off formularies. Manufacturers pay rebates to PBMs based on utilization, provide bonuses for moving product and hitting volume targets, and pay lucrative administrative fees to maximize PBM profits. Much of this activity is not transparent to anyone, including those who in good faith hire PBMs to manage their benefits.

The scourge of opioids has, unfortunately, affected nearly every community in the United States. Localities ranging from large metropolitan cities to small rural counties are spending a significant amount of public money to ease the strain that the opioid scourge leaves in its wake. Fire and emergency medical services are over-utilized because of an increased number of opioid-related overdoses. Police are overwhelmed by opioid-related crimes related to heroin sales, prescription opioid theft, diversion, and prescription opioid sales on the black market. Foster care services are overrun with the children of addicts. Jails are filled to the brim with inmates who are there as a result of opioid-related crimes and are often in need of exorbitantly expensive healthcare treatment as a result of opioid addiction and the health problems it causes. Localities’ funds have been diverted from other services to pay for anti-overdose kits for police, firefighters, and other government workers. The list of harm to localities across the country is long, and there have been hundreds of suits filed across the country by localities that are seeking to address that harm.

If you work with a county or city government and you believe that your community has been negatively affected by the scourge of opioids, you should contact an attorney experienced in opioid litigation to discuss your community’s potential legal claims. Sanford Heisler Sharp has experienced litigators that represent communities across the nation in their claims to redress the harms that the opioid epidemic has caused. The firm has offices in New York, Washington, DC, Baltimore, Nashville, San Francisco, and San Diego.