Opioid Manufacturers Face Mounting Legal Challenges

As an epidemic of opioid abuse has swept through parts of the United States, a growing number of legal drug manufacturers have encountered litigation challenges in state and federal court over allegedly deceptive marketing tactics. Recently, Tucson Medical Center took the novel step of suing several pharmaceutical companies which produce or distribute opioids. The outcome of the case could hold significant ramifications for drug makers and medical institutions and, ultimately, consumers paying for prescription medications.

Opioid Marketing, Publicity, And Stock Volatility

The hospital filed lawsuits against a list of defendants which included Arizona-based Insys Therapeutics, Inc., a firm which has recently faced a number of lawsuits after entering into a $150 million settlement agreement with the federal government. The pharma company became the target of a Justice Department investigation into alleged improper opioid marketing practices. Its legal challenges multiplied after Attorney Generals in several states (including Oregon, Illinois, Massachusetts, and New Hampshire) also launched consumer investigations at the state level.

Last week, Maryland’s Attorney General announced his agency had filed consumer protection charges against the Arizona-based drug manufacturing company over its aggressive marketing of Subsys, an addictive fentanyl product which reportedly became the subject of improper prescriptions by numerous physicians. His public pronouncement attracted national media interest. The lawsuits involving Insys Therapeutics, Inc., coupled with investor anticipation following the grant of FDA “fast track” approval for a new nasal spray product (not an opioid), apparently caused the company’s stock to move with volatility recently several times.

A Hospital Evaluates Opioid Marketing Impacts

Tucson Medical Center reportedly took the step of filing suit against several pharmaceutical firms after it determined opioid and addiction problems in Arizona have disproportionately impacted its consumer base and increased its burden as a Pima County facility in caring for its patients. For instance, during 2016, the medical center reportedly had to initiate costly measures to provide care for at risk and addicted babies born to opioid addicted mothers. It admitted some 10,000 patients between April, 2016 and September, 2017 as a result of opioid-related conditions (including addictions and overdoses).

Some other companies listed as defendants in the case include Purdue Pharma, Allergen, Abbott Laboratories, Johnson & Johnson, and McKesson Corp. The hospital filed suit against a total of 24 manufacturers and drug distribution firms. The civil suit seeks both compensatory and punitive damages.

Information Sources:


2. https://www.reuters.com/article/us-insys-opioids/maryland-charges-insys-with-engaging-in-deceptive-opioid-scheme-idUSKCN1LM2HI

3. https://www.marketwatch.com/press-release/fda-grants-insys-therapeutics-fast-track-designation-for-epinephrine-nasal-spray-as-investigational-treatment-for-anaphylaxis-2018-08-30

4. https://law.stanford.edu/2018/08/30/q-and-a-with-mello-and-engstrom/

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