Preview Newsletter
Opioid Daily Report (8/16)
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Columbia County moves to enter statewide suit against opioid manufacturers; will partner with Pathways to Recovery for hotline
Aug 16, 2017 | Columbia-Greene Media
By Richard Moody
The Columbia County Committee on Health and Human Services pushed forward a resolution to join a statewide lawsuit against certain pharmaceutical companies accusing the companies of falsely advertising such drugs as safe and nonaddictive. -
Opioid lawsuit correct course
Aug 16, 2017 | Nashua Telegraph (NH)
The Nashua Finance Committee tonight will discuss a resolution that would have the city’s counsel services continue to explore the possibility of taking on the manufacturers of opioid medications in a courtroom. -
Darien, New Canaan to consider joining class action suit against opioid manufacturers
Aug 16, 2017 | Darien News (CT)
By Justin Papp
A new class action suit is taking shape in Connecticut that would hold accountable the makers of prescription opioids. -
States try to hit wallets of opioid makers
Aug 16, 2017 | Washington Examiner
By Robert King
States are filing lawsuits against opioid makers to try to stem the growing tide of opioid overdose deaths, but experts question if the effort will be any help. -
Cincinnati suing big pharma for opioid epidemic
Aug 15, 2017 | Fox19 Now (OH)
By Steve Beynon
Opioid abuse is rampant in Ohio — first responder are increasingly spending their time reviving addicts and coroners' offices are running out of space to store bodies. -
South Carolina sues OxyContin maker Purdue over opioid marketing
Aug 15, 2017 | Reuters
By Nate Raymond
South Carolina sued Purdue Pharma LP on Tuesday, becoming the latest state or local government to accuse the OxyContin maker of deceptive marketing practices that have contributed to a national opioid addiction epidemic. -
South Carolina Sues Purdue Pharma, Alleging Deceptive Opioid Marketing
Aug 15, 2017 | Wall Street Journal
By Sara Randozzo
Lawsuits filed over the opioid crisis continued to mount this week, with an action Tuesday brought by South Carolina against drugmaker Purdue Pharma LP and suits by Birmingham, Ala., and Cincinnati against drug distributors. -
South Carolina Attorney General Sues Opioid Manufacturer Purdue Pharma Over Drug Crisis
Aug 15, 2017 | International Business Times
By Denisse Moreno
South Carolina filed a lawsuit against opioid manufacturer Purdue Pharma over the state’s opioid epidemic, the attorney general’s office announced Tuesday. -
Johnson & Johnson: The Financial Times Sees Tobacco-Sized Legal Liabilities Due To The Opioid Crisis
Aug 15, 2017 | Seeking Alpha
By David Pinsen
In March, we mentioned the opioid crisis risk for JNJ but also noted that Portfolio Armor estimated a potential return of 6.7% for the stock over the next several months. -
Lawsuit accuses drug manufacturer of worsening opioid crisis
Aug 15, 2017 | AP
By Meg Kinnard
South Carolina on Monday became the latest state to accuse a drug manufacturer of exacerbating its opioid drug crisis by using deceptive marketing. -
South Carolina Joins States Suing Purdue Pharma Over Opioids
Aug 15, 2017 | Bloomberg
By Jef Feeley and Jared S Hokpkins
South Carolina joined a growing list of states suing opioid makers, a signal of increasing pressure on pharmaceutical companies as the addiction crisis takes hold -
Good Morning Cincinnati at 4:30am
Aug 16, 2017 | WRKC (CBS)
By Cinncinnati, OH
VIDEO LINK: http://app.criticalmention.com/app/#clip/view/28870582?token=b584e30d-62c0-479d-a9ac-67a50dcc22c2 Rough Transcript: The growing list of cities and states filing lawsuits against drug manufacturers they say contribute to the opioid cris.mayor john cranley announced the city sued wholesale drug distributors amerisource bergen, cardinal health and mckesson corporation.heroin and opioid addiction continues to rise in the u-s, especially in the tri-state.back in may, ohio's attorney general sued five drug makers for their role in the state's addiction crisis, he accuses the companies of intentionally misleading patients about the dangers of painkillers. -
The NOW
Aug 15, 2017 | WEWS (ABC)
By Cleveland, OH
VIDEO LINK: http://app.criticalmention.com/app/#clip/view/28866601?token=7af2ff0e-a8c3-467c-9d76-7b83535d331a Rough Transcript: "Right now, cincinnati officials are filing lawsuit against three drug wholesale companies, accusing them of flooding the city with opioids that created a serious public health crisis. that the company broke laws and should help find a cure for the epidemic. the company should pay taxpayers back for all the money they spent. back in may, the state of ohio filed a lawsuit against five major drug manufacturers for their role in the opioid the -- epidemic."
Traditional Media Coverage
Broadcast Media Coverage
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Aug 16, 2017 | Columbia-Greene Media
By Richard Moody
The Columbia County Committee on Health and Human Services pushed forward a resolution to join a statewide lawsuit against certain pharmaceutical companies accusing the companies of falsely advertising such drugs as safe and nonaddictive.
Greene County will also move forward this month to enter into a class action lawsuit against certain pharmaceutical companies for the same reasons.
The law firm Simmons, Hanly and Conroy, of Illinois, asked Columbia County in June to join them in suing for recompense for services the county has provided as a result of the nationwide opioid and heroin epidemic.
The law firm promised that it will pay for all the legal costs.
“We have talked about this issue at great length. The opioid epidemic is a scourge that affects everyone regardless of background or age,” said Fourth Ward Supervisor William Hughes Jr. “I think all 62 New York counties should join us in the lawsuit.”
Already several counties in the area have joined the lawsuit including Albany and Schenectady, and most recently Dutchess County.
Data provided by the Healthcare Consortium showed there were six recorded opioid-related deaths in Columbia County and eight in Greene County in 2015.
According to the data, 194 people received some kind of treatment for a chemical dependence crisis in Columbia County in 2015; Greene County saw 144 people treated that same year.
“We will be going forward with a class action lawsuit at the recommendation of our attorney,” said Greene County Administrator Shaun Groden. “It will be on our agenda this month. After that we will enter into a contract.”
The plaintiffs in the lawsuit are seeking to recoup money counties have spent on services such as mental health programs, addiction programs, public defenders and district attorneys, probation services and jail expenses.
The firm successfully sued Purdue Pharma LLP and Abbot Laboratories, Inc., alleging that 5,000 clients’ addictions to OxyContin was a result of the manufacturer’s fraudulent marketing campaign that claimed the drug was not as addictive as alternative drugs.
The lawsuit also names several other companies including Teva Pharmaceuticals USA, Inc.; Cephalon, Inc.; Johnson & Johnson; Janssen Pharmaceuticals, Inc.; Ortho-McNeil-Janssen Pharmaceuticals, Inc.; Janssen Pharmaceutical, Inc.; Endo Health Solutions Inc.; and Endo Pharmaceuticals, Inc., as well as four physicians who were paid to appear in advertisements for opioids: Russell Portenoy, Perry Fine, Scott Fishman and Lynn Webster.
The committee also approved utilizing the resources of Chatham-based Columbia Pathways to Recovery, Inc., a local non-profit that runs solely on the work of volunteers, that helps people connect with services and provides educational events and training sessions on narcan, a drug that reverses opioid overdoses, throughout the county.
The nonprofit, which only obtained it 501(c)(3) status this year, asked the committee to help expand their services and help them continue to operate a help line they run.
The group works with other providers in the area including Project Safe Point, Twin County Recovery Services, Inc., The Healthcare Consortium, Chatham Cares 4 U and several county agencies already, but want a help center and an expanded help line through the county, which would include a $10,000 so the group can become compliant with HIPPA law.
“We went through the services this county has for people who are going through crisis or are addicted to substances and we came up with one question — who do you call?” Hughes said. “A dedicated phone line is critical in our fight against opioid abuse.”
The committee agreed to partner with the group, but without any financial commitment for the time being until the county controller can review the group’s finances.
“I think this could be largely and mutually beneficial,” said Kinderhook Town Supervisor Patrick Grattan, chairman of the committee. “I can support this.”
The committee asked Public Health Director John Mabb his thoughts on the request.
“A 24-hour hotline is critical, absolutely critical and we did not have one; CPR provided that service on their own,” Mabb said.
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Aug 16, 2017 | Nashua Telegraph (NH)
The Nashua Finance Committee tonight will discuss a resolution that would have the city’s counsel services continue to explore the possibility of taking on the manufacturers of opioid medications in a courtroom.
Remainder of article is available under paywall: http://www.nashuatelegraph.com/opinion/2017/08/16/opioid-lawsuit-correct-course/
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Darien, New Canaan to consider joining class action suit against opioid manufacturers
Aug 16, 2017 | Darien News (CT)
By Justin Papp
A new class action suit is taking shape in Connecticut that would hold accountable the makers of prescription opioids.
Headed by the Mayor of Waterbury and other local leaders, with the help of the Connecticut Conference of Municipalities (CCM), the suit would hold pharmaceutical companies accountable for aggressive marketing and the permeation of false information regarding the safety of prescription opioids and seek damages for those that have fallen victim to the scourge of opioids.
In Fairfield County, leaders of municipalities like Danbury and Ridgefield have stated their potential interest. In Darien, First Selectman Jayme Stevenson also suggested he was considering joining the suit.
“We have expressed our interest from the beginning. Town Attorney Wayne Fox and I are both information gathering,” Stevenson said. “I’m not saying we’re committed today, but we’re definitely interested in getting more information on the lawsuit and its potential outcomes.”
In July, Waterbury retained the New York law firm Simmons, Hanly, and Conroy, who will make a presentation to CCM — whose staff is helping to find co-litigants — in late August, after which point municipalities can officially join the suit. Simmons, Hanly and Conroy filed similar suits earlier this year on behalf of several New York counties.
Stevenson said she planned to attend the Aug. 31 informational meeting between the lawyers and CCM members in Waterbury.
“I would look favorably on joining something like that,” Mallozzi said, though he added he’d been away for a week and needed to better understand the details of the suit. “Just looking at the opioid issue, what CCM is doing there is the right thing.”
Mallozzi and the town of New Canaan rejoined the CCM in 2017 after several years not holding membership. Efforts like this, Mallozzi said, are why he encouraged the town to link back up with CCM.
Mallozzi also emphasized the impact of opioids on a town like New Canaan.
“How many lives have been affected here by opioid addiction? How many friends and family have lost children because of it?” Mallozzi said.
He estimated that seven members of the community had died as a result of opioids in the last six years. The exact number, Mallozzi said, is difficult to pin down because of the stigma surrounding prescription opioids and heroin, a more potent and less expensive opiate. In many cases, the parents of those afflicted are hesitant to speak up and provide a cause of death, Mallozzi said.
There were 917 overdose deaths in Connecticut, up 25 percent from 2015, many of which were the result of fentanyl, a synthetic opioid more potent than heroin. Fentanyl deaths rose by 155 percent in 2016.
Stevenson also suggested that the numbers may not accurately represent the gravity of the situation, as many opioid and drug related deaths are reported as “accidental poisonings.”
“It would be more helpful to communities if alcohol, drug, opioid information was reported as such,” Stevenson said. “We consider the impact of opioids on our community to be substantial.”
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States try to hit wallets of opioid makers
Aug 16, 2017 | Washington Examiner
By Robert King
States are filing lawsuits against opioid makers to try to stem the growing tide of opioid overdose deaths, but experts question if the effort will be any help.
Several states and local governments over recent months have sued opioid makers, claiming that they contributed to the nationwide epidemic through deceptive marketing and playing down the addictive power of the painkillers when pitching them to doctors.
But the move raises several major questions. Chief among them is whether the lawsuits can make a dent in an epidemic that killed 33,000 Americans in 2015.
"Even if the drug companies had to pay a lot of money either because of settlements or damage rewards, I am not sure it is gonna affect their behavior much," said Richard Ausness, associate dean at the University of Kentucky's law school and an expert in liability law.
Ausness pointed out the 2007 federal settlement with Purdue Pharma, the maker of powerful painkiller Oxycontin. The company paid the federal government more than $600 million to settle claims that it misled the public over the addictive power of Oxycontin.
"Did it stop them? No, they kept on doing it because they were making billions of dollars a year from the sale of opioids," Ausness said.
Now Purdue faces lawsuits from Ohio, Oklahoma, Missouri, Mississippi, New Hampshire and South Carolina. Several counties in California and New York as well as Chicago also have sued opioid makers. Cincinnati on Tuesday sued several opioid distributors.
Ausness said governments need to do more than just win money from the companies to change behavior or ease the opioid epidemic.
"Simply extracting money from them is probably not going to help much in dealing with opioid addiction," he said. "In theory, states and cities would spend money on addiction and treatment, but who knows what they would do."
In Oklahoma, the decision on how to spend the proceeds from a settlement or ruling would be made by the legislature with input from the attorney general, said Terri Watkins, a spokeswoman for Attorney General Mike Hunter. He has publicly said he wants the money to go toward treatment and fighting illegal drug trafficking.
Watkins added that another purpose of the lawsuit is to get opioid makers to change their marketing and to "deal with the cost to the state of opioid addictions."
But there is no guarantee that money from any settlements would go toward prevention, based on the 1990s settlement between 46 states and major tobacco makers.
The tobacco industry has paid out roughly $144 billion to the states from 1998 to 2017. Of that $144 billion, only about $500 million went to smoking prevention, according to data from the Campaign for Tobacco-Free Kids.
Some states say the lawsuits are a way to force the industry to change its ways.
"If they're not going to do it voluntarily, we're going to drag them to the table and make them," Ohio Attorney General Mike DeWine told The Washington Post.
Addiction experts say more money needs to be put into treatment options.
The 21st Century Cures Act, signed into law last year by former President Barack Obama, gives states $1 billion in grants for treatment.
"Even with that amount of money being poured into states, it is not enough," said Tom Coderre, senior adviser with the Altarum Institute and former official at the Substance Abuse and Mental Health Services Administration.
Coderre said one of every 10 people has access to treatment. Even if that number rises to three or four of every 10 people, that is "still not going to stem the tide of the epidemic," he said.
More states could join the lawsuit effort in the near future. More than half of the country's attorneys general are investigating the marketing and sales tactics of opioid makers.
But experts are raising doubts as to whether the states can win if the cases go to trial.
"There are a number of arguments that drug companies can make that may or may not be persuasive," he said.
"There are a number of intervening bad actors between the drug companies and the cities and states getting stuck with the cost of addiction."
Those "bad actors" include doctors who overprescribe opioids, pharmacies that fill the product and addicts who misuse the drugs, he said.
"Drug companies can say it wasn't our fault and we are not fully responsible," he said.
Ausness said he thinks the governments likely will settle with the drug companies, as they did with the tobacco settlement.
But he cautioned that a settlement could take years. The first state lawsuit against cigarette makers was in 1994, with a master settlement being reached in November 1998.
"This is just trench warfare. Drug companies fight each and every step," Ausness said.
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Cincinnati suing big pharma for opioid epidemic
Aug 15, 2017 | Fox19 Now (OH)
By Steve Beynon
Opioid abuse is rampant in Ohio — first responder are increasingly spending their time reviving addicts and coroners' offices are running out of space to store bodies.
In recent years, drug abuse is one of the leading causes of death around Cincinnati.
Who is responsible for this? Cincinnati is taking pharmaceutical companies who downplayed the addictive nature of their drugs to court. Mayor John Cranley says they can be held legally responsible for the crisis many say snowballed from over-prescription of pain killers.
The drugs once intended for treat acute, short-term pain have been prescribed by doctors at higher rates and for longer durations. Cranley and other officials across the country say drug companies played a major role in promoting that change for profit, and the consequences are patients turning to heroin after becoming addicted.
Cranley on Tuesday announced the Queen City will be joining some attorneys general, states and cities such as Dayton in going after big pharma.
The announcement comes just as new federal data shows drug abuse deaths are on the rise, despite the efforts from cities and states to curtail the epidemic. In 2016, the National Center for Health Statistics estimates drug overdose death hit a record 19.9 per 100,000 people — up from 16.7 in 2015.
Named in the city’s suit is AmerisourceBergen, Cardinal Health and McKesson Corporation. Cranley says these companies have failed to control the high volume of opioid shipments to pharmacies and hospitals, violating the Controlled Substances Act passed in 1970.
Cincinnati's lawsuit seeks recovery money the city has spent on the public nuisance cause by the opioid epidemic, including the price of medical care and future damages.
"We are coming after them," Cranley said at a press conference Tuesday. “What’s motivating these companies is greed.”
The city's lawsuit follows similar cases in California, Illinois, New York and Mississippi. Ohio Attorney General Mike DeWine filed a suit in May, claiming the drug companies "borrowed a page from Big Tobacco" by "trivializing the risks of opioids while overstating the benefits of using them for chronic pain."
The defendants in the Ohio case include Johnson & Johnson, Pharmaceutical Industriesm, Purdue Pharma and others.
Middle-aged white men suffer disproportionately from opioid abuse, and the states with the highest overdose tolls are Ohio, Kentucky, New Hampshire and West Virginia, according to the NCHS.
“These companies have made billions of dollars, partly by destroying lives,” Cincinnati City Councilman P.G. Sittenfeld said. “There is blood on their hands.”
The lawsuits may not be as outlandish as they may sound at face value and there’s significant historical precedent for public officials going after private companies. In the 1990s, the tobacco industry was slammed with litigation from 46 states and local jurisdictions — which led to the Tobacco Master Settlement Agreement in 1998. The settlement eventually cost the tobacco industry more than $200 billion.
The states settled Medicaid lawsuit for recovery of tobacco-related health care costs, but also exempted the companies from private liability harm from tobacco use. The company's agreement to scale down marketing and pay in perpetuity annual payments to the states for compensation.
Last week, President Donald Trump declared the opioid crisis a national emergency just days after Health and Human Services Secretary Tom Price downplayed the need for a nationwide declaration.
"We're going to spend a lot of time, a lot of effort and a lot of money on the opioid crisis," Trump said at his New Jersey golf club Thursday. The president's announcement was not tied to any policy or specific goals. However, he has said in the past the crisis can be fought by beefing up law enforcement and constructing a multi-billion-dollar southern border wall — which Senate Republicans have expressed little-to-no support for.
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South Carolina sues OxyContin maker Purdue over opioid marketing
Aug 15, 2017 | Reuters
By Nate Raymond
South Carolina sued Purdue Pharma LP on Tuesday, becoming the latest state or local government to accuse the OxyContin maker of deceptive marketing practices that have contributed to a national opioid addiction epidemic.
The lawsuit by South Carolina Attorney General Alan Wilson, filed in Richland County Court of Common Pleas in Columbia, accuses the company of the unfair and deceptive marketing of opioid painkillers.
Wilson claimed Purdue has told doctors that patients who receive prescriptions for opioids generally will not become addicted and those who appeared to be were only "pseudoaddicted" and needed more of the drugs.
According to the U.S. Centers for Disease Control and Prevention, opioids were involved in over 33,000 deaths in 2015, the latest year for which data is available, and the death rate has continued rising, according to estimates.
Since a 2007 settlement with South Carolina, Purdue has continued to downplay the addictiveness of its opioid products and overstated the benefits compared to other pain management treatments, according to the lawsuit.
"While there is a time and place for patients to receive opioids, Purdue prevented doctors and patients from receiving complete and accurate information about opioids in order to make informed choices about their treatment options," Wilson said in a statement.
Stamford, Connecticut-based Purdue denied the allegations and said it shares the concerns of South Carolina officials about the crisis and is committed to finding solutions.
Purdue and other drugmakers have been sued over opioid products by Oklahoma, Mississippi, Ohio, Missouri and New Hampshire as well as cities and counties in California, Illinois, Ohio, Oregon, Tennessee and New York.
A group of state attorneys general in June announced an investigation into the role played by pharmaceutical manufacturers in the opioid epidemic.
Purdue and three executives pleaded guilty in 2007 to federal charges related to the misbranding of OxyContin, which is used to relieve pain, and agreed to pay a total of $634.5 million to resolve a U.S. Justice Department probe.
That year, the privately held company also reached a $19.5 million settlement with 26 states including South Carolina as well as the District of Columbia. It agreed in 2015 to pay $24 million to resolve a lawsuit by Kentucky.
In Tuesday's lawsuit, South Carolina claimed that since the 2007 settlement, Purdue has continued to engage in misleading opioid marketing practices rather than reforming them to conform with the law.
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South Carolina Sues Purdue Pharma, Alleging Deceptive Opioid Marketing
Aug 15, 2017 | Wall Street Journal
By Sara Randozzo
Lawsuits filed over the opioid crisis continued to mount this week, with an action Tuesday brought by South Carolina against drugmaker Purdue Pharma LP and suits by Birmingham, Ala., and Cincinnati against drug distributors.
South Carolina’s suit follows efforts by several other jurisdictions to hold pharmaceutical companies accountable for what they call deceptive marketing of opioid painkillers. The states and others say that such marketing has led to an epidemic among residents, leading to addiction, overdose and deaths.
The lawsuit, filed in South Carolina state court, focuses solely on Purdue Pharma, which manufactures OxyContin and other opioid drugs. New Hampshire last week filed a similar suit against Purdue.
The suit argues the company plays down opioids’ addictive nature and overstates the drugs’ benefits compared with other forms of pain management. It alleges Purdue told doctors that patients wouldn’t become addicted to opioids and misrepresented the efficacy of newer, abuse-deterrent drugs to stem addiction.
South Carolina Attorney General Alan Wilson said his office “is obligated to take action as South Carolinians continue to fall victim to Purdue’s deceptive marketing of its highly addictive opioid products without care for the lives and families it is jeopardizing.”
A Purdue spokesman said the company denies the allegations but shares South Carolina’s concerns about the opioid crisis and is committed to “working collaboratively to find solutions.”
The Purdue spokesman said OxyContin makes up less than 2% of the opioid analgesic prescription market nationally and that the company is “an industry leader in the development of abuse-deterrent technology, advocating for the use of prescription drug monitoring programs and supporting access to Naloxone,” a drug used to combat opioid overdoses.
Private law firms Motley Rice LLC, Thurmond Kirchner & Timbes PA, and James E. Smith, Jr., PA are assisting South Carolina on the suit.
The state said that more than 3,000 South Carolinians have died from prescription opioid overdoses since 2011 and that the number of infants born addicted to the drugs is on the rise.
Purdue has faced scrutiny over the painkillers before. In 2007, Purdue and three of its executives pleaded guilty in federal court to criminal charges of misleading the public about the addictive qualities of OxyContin between 1995 and 2001. Purdue and the executives agreed to pay $634.5 million in government penalties and costs to settle civil litigation. Around the same time, Purdue agreed to pay $19.5 million to settle similar allegations made by 26 states, including South Carolina, and the District of Columbia.
South Carolina says Purdue failed to comply with the 2007 agreement, and also violated the state’s unfair trade practices act and created a public nuisance.
Other states including Mississippi, Ohio, Missouri and Oklahoma have also sued opioid makers in recent months alleging deceptive marketing, though they have pursued a broader range of defendants.
Cincinnati and Birmingham, meanwhile, are taking a different tack. The cities this week filed public nuisance lawsuits against wholesale drug distributors they say are responsible for dumping millions of dollars’ worth of prescription opioids into the communities.
In federal lawsuits filed Tuesday in Ohio and Monday in Alabama, the cities allegeCardinal Health Inc., AmerisourceBergen Corp. , and McKesson Corp. unlawfully sold painkillers into the regions, prompting the “foreseeable, widespread diversion of prescription opioids into the illicit market.” The lawsuits allege the distributors shipped suspicious orders without properly reporting them to state and federal authorities.
Representatives for AmerisourceBergen and Cardinal separately said the companies plan to defend against the litigation while working collaboratively to combat opioid abuse and drug diversion. Wholesale drug distributors, both companies said, are logistics companies with no access to patient information or a direct role in the prescribing and dispensing of medicine.
Several other counties and cities, including in Ohio and West Virginia, have sued the three drug distributors this year in nearly identical lawsuits.
Cardinal said it has “state-of-the-art controls to combat the diversion of pain medications from legitimate uses” and AmerisourceBergen said it reports and stops suspicious orders.
A McKesson spokeswoman said the company is working to address the opioid crisis and takes its responsibility to “manage the safety and integrity of the pharmaceutical supply chain extremely seriously.” The company has strong programs, she said, to detect and prevent opioid diversion.
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South Carolina Attorney General Sues Opioid Manufacturer Purdue Pharma Over Drug Crisis
Aug 15, 2017 | International Business Times
By Denisse Moreno
South Carolina filed a lawsuit against opioid manufacturer Purdue Pharma over the state’s opioid epidemic, the attorney general’s office announced Tuesday.
In the lawsuit, Attorney General Alan Wilson said the company, which makes OxyContin and other opioid drugs, helped fuel the state’s drug epidemic.
The suit, filed in Richland County Court of Common Pleas in Columbia, claims Purdue violated South Carolina’s Unfair Trade Practices Act and said the manufacturer unfairly and deceptively marketed opioids.
Wilson said the company failed to comply with a 2007 settlement with the state and “significantly downplayed” how addictive the drugs are. The lawsuit said Purdue also overstated the benefits of opioids compared to other pain management options in an effort to increase profits.
Wilson said the lawsuit “seeks to hold Purdue accountable for creating this crisis and seeks remedies to stop its misleading, deceptive, and dangerous marketing tactics.”
The lawsuit claims that since 2007, Purdue did not reform its opioid marketing to comply with the law and instead “continued to mislead and obfuscate.”
The attorney general’s office also said Purdue told doctors' patients receiving opioid prescription for pain generally would not develop an addiction to the drug, and that physicians could use screening tools to exclude patients who might. Among numerous claims, the lawsuit said the company told doctors that patients who appeared addicted were not and they were instead “pseudoaddicted” and needed more drugs.
“While there is a time and place for patients to receive opioids, Purdue prevented doctors and patients from receiving complete and accurate information about opioids in order to make informed choices about their treatment options,” Wilson said.
In a statement to International Business Times, Purdue denied the accusations made by South Carolina’s attorney general.
The company said:
“While we vigorously deny the allegations, we share South Carolina officials’ concerns about the opioid crisis and we are committed to working collaboratively to find solutions. OxyContin accounts for less than 2% of the opioid analgesic prescription market nationally, but we are an industry leader in the development of abuse-deterrent technology, advocating for the use of prescription drug monitoring programs and supporting access to Naloxone -- all important components for combating the opioid crisis.”
South Carolina Opioid Crisis
South Carolina took the ninth spot in the country’s opioid prescribing rates last year, according to the Centers for Disease Control and Prevention. More than 3,000 people in the state have died from prescription opioid overdoses since 2011. The number of deaths due to heroin and prescription opioids even surpassed the number of homicides in South Carolina in 2015. Meanwhile, the number of babies born addicted to opioids in the state’s hospitals has quadrupled between 2000 and 2013.
“South Carolina is not immune to the headlines we see daily about the toll of opioids on individual patients, families, and communities,” Wilson said in a statement.” It has created a public health epidemic and imposed a significant burden on law enforcement and social services in our state.”
The South Carolina lawsuit comes after other states, including Ohio, Missouri, Mississippi, as well as cities and counties across the nation, take legal action against pharma companies over the opioid crisis. Ohio recently filed a lawsuit against five major drug companies, including Purdue Pharma. In the suit, Ohio Attorney General Mike DeWine said the companies misrepresented the risks of prescription opioids that led to a drug addiction epidemic in the state. The lawsuit said 2.3 million people in Ohio were prescribed opioids last year, which led to heroin abuse. The other four companies sued by Ohio are: Endo Health Solutions, Teva Pharmaceutical Industries and subsidiary Cephalon, Johnson & Johnson and subsidiary Janssen Pharmaceuticals and Allergan.
National Opioid Crisis
Last week, President Donald Trump declared the opioid crisis a national emergency. Approximately 90 people in the U.S. die from an opioid-related overdose every day, according to the CDC. The number of heroin opioid-related overdose deaths, which includes prescription opioids such as oxycodone, hydrocodone, and methadone, has quadrupled since 1999. Coincidentally, the rate of prescription opioids sold in the U.S. has nearly quadrupled since 1999.
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Johnson & Johnson: The Financial Times Sees Tobacco-Sized Legal Liabilities Due To The Opioid Crisis
Aug 15, 2017 | Seeking Alpha
By David Pinsen
In March, we mentioned the opioid crisis risk for JNJ but also noted that Portfolio Armor estimated a potential return of 6.7% for the stock over the next several months.
Since then, JNJ has climbed 7.25%, but now the Financial Times warns of a "tidal wave" of lawsuits related to the opioid epidemic, and ultimately, a tobacco-sized settlement.
We elaborate, update our current potential return estimate for JNJ, and present a way longs can position themselves to capture it while strictly limiting their risk.
A "Tidal Wave" Of Opioid Crisis Lawsuits
In an article in March we mentioned the Senate probe targeting Johnson & Johnson (JNJ) and other companies about their roles in the opioid crisis. Over the weekend, the front page of the Financial Times highlighted the lawsuit risk JNJ and other drug manufacturers and distributors face. We elaborate below, and present a way JNJ longs can limit their risk over the next several months. First, a quick update on how JNJ has performed since our last article on it.
In our March article, we noted that Portfolio Armor had estimated a potential return of 6.7% for JNJ over the next several months. Since then, the stock has climbed 7.25% (Portfolio Armor generates the potential return estimates we use in Bulletproof Investing).
We were a bit surprised to see JNJ post a fractional gain Monday, after the FT's front-pager over the weekend -- Drug Groups Face 'Tidal Wave' Of Opioid Lawsuits -- (paywalled here). In that article, the FT drew parallels to the $200 billion+ tobacco settlement:
The number of officials launching legal action against drugmakers and wholesalers has soared in the past year in what some lawyers see as a harbinger of a settlement that could echo the more than $200 billion extracted from the tobacco industry in 1998.
According to a Financial Times analysis, at least 30 states, cities and counties have either filed lawsuits or are formally recruiting lawyers using a process that tends to be a prelude to full-blow legal action. [...]
The most commonly named as defendants include drugmakers such as Perdue Pharmaceuticals, Johnson & Johnson, Allergan (AGN) and Teva (TEVA); distributors such as McKesson (MCK), AmerisourceBergen (ABC) and Cardinal Health (CAH); and pharmacies such as Walgreens and CVS Health (CVS). [...]
"It's a tidal wave," said Jodi Avergun, a lawyer at Cadwalader, Wickersham & Taft. "If I were an executive, I would be asking how many more of these are there going to be. At every level of government in almost every state, there is a potential plaintiff."
So far, JNJ shareholders appear unconcerned by this, and Portfolio Armor remains moderately bullish on JNJ, currently estimating a potential return of about 9% between now and January. Below we'll look at a way to capture that potential upside if it happens, while strictly limiting your risk if this tidal wave of lawsuits starts weighing on the stock.
Adding Downside Protection To JNJ
We'll assume, for this example, that you are willing to tolerate a drawdown of 12% in your JNJ position over the next several months, but not more than that.
As of Monday's close, this was the optimal, or least expensive, collar to hedge 1,000 shares of JNJ against a greater-than-12% decline by mid-January, while not capping your potential upside at less than 9% by then.
As you can see above, the cost of the put leg of this collar was $1,480, or 1.11% of position value. Note that this was calculated conservative, using the ask price of the puts. As you can see below, though, this cost was partially offset by income of $350, or 0.35% of position value, from selling the call leg. That income was calculated conservatively as well, using the bid price of the calls.
So the net cost here was $1,130, or 0.85% of position value, assuming you placed both trades at the worst end of the spread.
Conclusion
We're still moderately bullish on JNJ, though it's unlikely to appear in our top names post for subscribers this week, because it's potential return isn't high enough. If you're long the stock and concerned about the opioid lawsuits, you may want to consider taking profits or adding some protection. You can use different parameters than the ones in our example if your risk tolerance is different, though the cost of your hedge may vary accordingly.
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Lawsuit accuses drug manufacturer of worsening opioid crisis
Aug 15, 2017 | AP
By Meg Kinnard
South Carolina on Monday became the latest state to accuse a drug manufacturer of exacerbating its opioid drug crisis by using deceptive marketing.
Attorney General Alan Wilson sued Purdue Pharma on Monday, accusing the maker of OxyContin and other opioid drugs of violating South Carolina's Unfair Trade Practices Act.
"While we vigorously deny the allegations, we share South Carolina officials' concerns about the opioid crisis and we are committed to working collaboratively to find solutions," Purdue Pharma responded in a statement.
The suit, filed in Richland County, accuses Purdue of failing to comply with a 2007 agreement it signed with South Carolina and dozens of other states over allegations of its promotion of OxyContin. Purdue admitted no fault in that case, which accused the company of encouraging doctors to prescribe OxyContin for unapproved uses and failing to disclose its potential for addiction.
That consent agreement required Purdue to correct its allegedly abusive and excessive marketing practices, maintain a program to identify prescribers who over-prescribe OxyContin and train sales representatives in the abuse and diversion detection program before they can promote the drug.
Since that time, Wilson said the company has continued to mislead doctors about the risks of addiction, by saying that patients who appeared addicted actually needed more opioids, and that opioid drugs could be taken in even higher doses without disclosing the greater risks to patients.
Wilson said South Carolina had the ninth highest rate of opioid prescriptions in the nation last year. Since 2011, prosecutors said, more than 3,000 South Carolinians have died from prescription opioid overdoses.
"OxyContin accounts for less than 2% of the opioid analgesic prescription market nationally, but we are an industry leader in the development of abuse-deterrent technology, advocating for the use of prescription drug monitoring programs and supporting access to Naloxone -- all important components for combating the opioid crisis," the company statement said.
But the lawsuit accuses Purdue of falsely claiming that its newer, abuse-deterrent opioids are safer than other opioid drugs.
South Carolina has already won millions from another drug company over unfair trade practices allegations. In 2011, a Johnson & Johnson subsidiary was ordered to pay the state $327 million for downplaying to doctors the links between diabetes and Risperdal. The award, later cut to $124 million, represented a $300 penalty per sample box of the drug that was distributed, plus $4,000 for each letter the company wrote to doctors.
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South Carolina Joins States Suing Purdue Pharma Over Opioids
Aug 15, 2017 | Bloomberg
By Jef Feeley and Jared S Hokpkins
Big Pharma is having a Big Tobacco moment as litigation over opioids attract star lawyers and a growing list of states and local governments seeking their own multibillion-dollar payout to deal with costs of a burgeoning drug epidemic.
On Tuesday, South Carolina became the sixth state to sue opioid makers alleging they have created a public health crisis. The suit filed by Joe Rice, a plaintiff lawyer who helped negotiate a $246 billion settlement with the tobacco industry in 1998, suggest states are laying the groundwork to force a resolution that provides billions of dollars to cover the costs of an epidemic blamed for 62 deaths per day.
“The more states they have signed up, the bigger their hammer when it comes time to decide who should be on the settlement negotiating committee,” said David Logan, a Roger Williams University law professor who teaches mass-tort cases.
Legal action tied to opioids is increasing at the same time that lawmakers are seeking more funding to defray costs tied to abuse, addiction and overdoses. Last week, President Donald Trump said he’s ready to declare a national emergency, which would clear the way for extra funding and government authority to address the wave of drug-related deaths. The administration gave no timetable for when the declaration would be signed.
In response to South Carolina’s lawsuit, filed in state court in Columbia, Purdue spokesman John Puskar said Tuesday that while the company denies the allegations, it shares the state’s “concerns about the opioid crisis.”
‘Find Solutions’
“We are committed to working collaboratively to find solutions,” Puskar said in an email. “OxyContin accounts for less than 2 percent of the opioid analgesic prescription market nationally but we are an industry leader in the development of abuse-deterrent technology, advocating for the use of prescription drug monitoring programs and supporting access to Naloxone.”
More than 22,000 Americans died from prescription opioid overdoses in the U.S. in 2015, an increase from 19,000 the year before, according to the Centers for Disease Control and Prevention.
A study in the October issue of Medical Care journal puts the economic cost of opioid overdose, abuse and dependence at $78.5 billion. Health care accounts for about a third of that cost while expenses for lost productivity in non-fatal cases add another $20 billion, according to the journal published by Wolters Kluwer.
South Carolina’s complaint follows similar filings by New Hampshire, Ohio, Missouri, Oklahoma and Mississippi. Drugmakers are also facing more than a dozen other complaints filed by counties and cities accusing them of downplaying the addiction risks and overstating the effectiveness of powerful painkillers.
“If they can get 14 or 15 states to file against the drugmakers, that will put stress on the companies, cost wise, to defend these suits all over the country,” said Carl Tobias, who teaches product-liability law at the University of Richmond in Virginia. “That will give them incentive to talk rather than fight.”
Star Lawyers
Even more important than the states themselves are the lawyers behind the complaints; a dream team comprised of plaintiff attorneys who successfully sued Big Tobacco including Rice, Steve Berman, and ex-Mississippi Attorney General Michael Moore.
The lawyers are likely taking the cases on contingency, which means they only get paid if they win in court and recover money for the states or they settle the cases.
While it’s too early to quantify a dollar amount needed to fully compensate states, Anthony Sabino, a law professor at St. John’s University in New York, said he could foresee a “low double-digit billion settlement.” Any deal would also likely come with demands for fewer drug ads, he said.
Some opioid drugmakers, such as Johnson & Johnson’s Janssen unit, are standing firm by vouching for the safety of their drugs. Others, like Dublin-based Endo International Plc, have already pulled the plug on some of their products. Endo halted sales of its Opana ER painkiller in July following a request from U.S. Food and Drug Administration.
Purdue’s Troubles
In the South Carolina case, Purdue is accused of marketing its OxyContin drug in violation of an earlier agreement to avoid stoking the abuse epidemic, according to court filings.
In May 2007, the Stamford, Connecticut-based company pleaded guilty to misleading the public about OxyContin’s addiction risk, and agreed to pay $600 million in one of the largest pharmaceutical settlements in U.S. history. The case also ensnared Purdue’s president, top lawyer, and chief medical officer who all pleaded guilty to criminal misbranding charges and agreed to pay a total of $34.5 million in fines.
Counties are also suing opioid makers to recoup billions in costs. Officials of Multnomah County in Oregon are seeking $250 million in damages for costs dealing with overdoses, treating and housing addicts and training county staff on the use of naloxone. In an Aug. 3 lawsuit, county officials said pharmaceutical makers engaged in a “campaign of lies and deceptions” for more than 20 years.
Three Ohio counties also filed suits in state court earlier this month alleging McKesson Corp. and Cardinal Health Inc. failed to properly regulate deliveries of opioid painkillers and ignored red flags about large orders.
The case is State of SC v. Purdue Pharma, No. 2017-CP-400-4872, Richland County Court of Common Pleas (Columbia).
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Good Morning Cincinnati at 4:30am
Aug 16, 2017 | WRKC (CBS)
By Cinncinnati, OH
VIDEO LINK: http://app.criticalmention.com/app/#clip/view/28870582?token=b584e30d-62c0-479d-a9ac-67a50dcc22c2
Rough Transcript: The growing list of cities and states filing lawsuits against drug manufacturers they say contribute to the opioid cris.mayor john cranley announced the city sued wholesale drug distributors amerisource bergen, cardinal health and mckesson corporation.heroin and opioid addiction continues to rise in the u-s, especially in the tri-state.back in may, ohio's attorney general sued five drug makers for their role in the state's addiction crisis, he accuses the companies of intentionally misleading patients about the dangers of painkillers.
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Aug 15, 2017 | WEWS (ABC)
By Cleveland, OH
VIDEO LINK: http://app.criticalmention.com/app/#clip/view/28866601?token=7af2ff0e-a8c3-467c-9d76-7b83535d331a
Rough Transcript: "Right now, cincinnati officials are filing lawsuit against three drug wholesale companies, accusing them of flooding the city with opioids that created a serious public health crisis. that the company broke laws and should help find a cure for the epidemic. the company should pay taxpayers back for all the money they spent. back in may, the state of ohio filed a lawsuit against five major drug manufacturers for their role in the opioid the -- epidemic".
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