By Ethan Haddon
Starting October 21, 2019, a civil jury trial will commence to consider the implications of the United States’ opioid crisis. United States District Court Judge Dan Polster, for the Northern District of Ohio, will preside over the trial.[1] This trial is unique, though, because it is the product of more than 2,000 pending lawsuits, which have been consolidated by the Judicial Panel on Multidistrict Litigation.[2] The consolidated case is referenced as In re National Prescription Opiate Litigation.[3] The defendants in the litigation include pharmaceutical manufacturers, distribution companies, and even individual doctors who have been blamed by the plaintiffs for causing and perpetuating the opioid crisis.[4] There are more than 2,500 plaintiff parties, including cities, towns, individuals, and other interested groups.[5]
Between 1999 and 2017, close to 218,000 people in the United States died from overdoses related to prescription opioids.[6] The number of opioid-related overdose deaths has grown since 1999, with the death toll in 2017 being five times what it was in 1999.[7] Blame for these deaths shifted to pharmaceutical companies and medical professionals for their role in aggressively marketing and prescribing prescription opioids, all the while potentially knowing the high risk for addiction and abuse.[8]
Estimates on the economic burden of the opioid crisis range from $50 billion to over $1 trillion since 2001.[9] This enormous economic cost is a major consideration when assessing damages or a potential settlement agreement between the parties.[10] With opioid use still rising, the economic burden stands to increase unless there is a major change.[11]
The consolidated trial will not be the first time the courts grapple with the opioid crisis. An Oklahoma state trial court recently ruled against Johnson & Johnson, with Cleveland County Judge Thad Balkman issuing an order that the company pay $572 million for its role in the opioid crisis.[12] The Oklahoma trial was the first time a pharmaceutical company had reached this stage of litigation.[13] Judge Balkman ruled after a non-jury trial that Johnson & Johnson had violated the state’s public nuisance law by “engag[ing] in false and misleading marketing of both their drugs and opioids generally.”[14] Johnson & Johnson indicated that it planned to appeal the ruling. Judge Balkman has agreed with Johnson & Johnson that there was a mathematical error in the judgment and intends to reduce the penalty by more than $100 million.[15]
With In re National Prescription Opiate Litigation still pending, there is a possibility of settlement. Judge Polster expressed a desire for settlement and suggested that settlement should not only be monetary but should include “real solutions that will help abate the number of overdose deaths the country sees on a daily basis.”[16] When speaking on who to blame for the opioid crisis, Judge Polster said he feels that “everyone shares some of the responsibility, and no one has done enough to abate it. That includes the manufacturers, the distributors, the pharmacies, the doctors, the federal government and state government, local governments, hospitals, third-party players and individuals.”[17] Judge Polster opined in his memorandum in which he certified the negotiation class that a settlement in this litigation “is especially important as it would expedite relief to communities so they can better address this devastating national health crisis.”[18]
A settlement is concerning for defendants, due to the fear of class members opting out of the settlement after it is reached.[19] If this happened, the defendants would have paid money to settle claims, but then would potentially still face litigation against the parties who opted out.[20] Due in part to this concern, Judge Polster authorized a new form of class action called a “negotiation class certification” to negotiate settlements with defendants on the claims.[21] The newly-formulated process will have class certification and the opt-out option occur before a settlement is reached which will give defendants “a sense of the precise scope of the group with whom they are negotiating.”[22]
This settlement process will also protect the rights of class members.[23] Class members will be able to calculate their share of a potential settlement before they are required to make the opt out decision, and a proposed settlement amount will require a supermajority (75%) of class members voting in favor of it for it to be effective.[24] Overall, Judge Polster determined that the proposed procedure is legitimate, certification is warranted, and that global settlement is more likely to be successful than be prevented under this process.[25]
Notably, Purdue Pharma, the manufacturer of the opioid painkiller OxyContin has already reached a settlement agreement in principle with the plaintiffs in this case.[26] Purdue is set to reorganize under Chapter 11 bankruptcy in order to fulfill the settlement agreement.[27] The settlement would involve Purdue creating a new company that will be run by a new board of directors.[28] The new board would “potentially contribut[e] tens of millions of doses of opioid overdose reversal and addiction treatment at low or no cost.”[29] Financially, Purdue would contribute all of its assets to a “trust or other entity established for the benefit of claimants and the American people,” and the Sackler family would contribute $3 billion and potentially contribute further profits from OxyContin.[30] However, some parties think that the Sackler family should contribute more.[31]
Three drug distributors, McKesson Corp., AmerisourceBergen Corp., and Cardinal Health Inc. have been in talks to pay $18 billion over 18 years under a potential deal as settlement.[32] Like the settlement in principle from Purdue, this settlement agreement would involve the companies donating drugs to treat opioid addiction.[33] Other settlement talks have involved these pharmaceutical distributors as well as Johnson & Johnson, with one plan calling for $22 billion in cash to be paid out over eighteen years and $26 billion to be contributed in the form of anti-addiction and drug treatment medication.[34]
The upcoming consolidated trial could be a turning point in the opioid epidemic in the United States. With settlement negotiations and litigation that could involve billions of dollars from drug manufacturers and distributors, there is much at stake. Settlements under Judge Polster’s “negotiation class certification” scheme could achieve his desired result of efficient abatement of the continually growing problem Americans face. Should the litigation progress through the trial stage, the outcome will likely have a fundamental impact on the landscape of the pharmaceutical industry.
[1] Colin Dwyer, Your Guide to the Massive (and Massively Complex) Opioid Litigation, NPR (Oct. 15, 2019) https://www.npr.org/sections/health-shots/2019/10/15/761537367/your-guide-to-the-massive-and-massively-complex-opioid-litigation?routingAction=LoadFeature&selEditFeature=761537367&editorVersion=old#basics.
[2] 28 U.S.C. § 1407 (2012); Overview of Panel, U.S. Jud. Panel on Multidistrict Litig., https://www.jpml.uscourts.gov/overview-panel-0 (last visited Oct. 17, 2019) (explaining the Judicial Panel on Multidistrict Litigation was created by Congress to identify and consolidate claims across different federal districts that share common issues);Dwyer, supra note 1.
[3] In re Nat’l Prescription Opioid Litig., 290 F. Supp. 3d. 1375 (J.P.M.L. 2017).
[4] Id.
[5] Id.; Content Details 17-2804 – In Re: National Prescription Opiate Litigation, govinfo, https://www.govinfo.gov/app/details/USCOURTS-ohnd-1_17-md-02804/USCOURTS-ohnd-1_17-md-02804-0/summary (last visited Oct. 17, 2019).
[6] Ctr. for Disease Control and Prevention, Opioid Overdose, CDC, https://www.cdc.gov/drugoverdose/data/prescribing/overview.html (last visited Oct. 17, 2019).
[7] Id.
[8] Dwyer, supra note 1.
[9] Id.
[10] Id.
[11] Id.
[12] State v. Purdue Pharma LP, No. CJ-2017-816, 2019 WL 4019929, at *20 (Okl.Dist. Aug. 26, 2019).
[13] Sara Randazzo, Drug Distributors in Talks to Settle Opioid Litigation for $18 Billion, Wall Street J., (Oct. 15, 2019) https://www.wsj.com/articles/drug-distributors-in-talks-to-settle-opioid-litigation-for-18-billion-11571170730.
[14] Purdue Pharma LP, 2019 WL 4019929, at *12.
[15] Randazzo, supra note 13.
[16] Eric Hesig, Here’s Why a Federal Judge Presiding Over Opioid Lawsuits Thinks Settling Them is Important, cleveland.com (Jan. 30, 2019) https://www.cleveland.com/court-justice/2018/01/heres_why_a_federal_judge_pres.html.
[17] Id.
[18] Memorandum Opinion Certifying Negotiation Class at 2, In re: Nat’l Prescription Opioid Litig. No. 1:17-MD-2804 (M.D. Ohio Sept. 11, 2019) Doc No. 2590.
[19] Id.
[20] Id.
[21] Id.
[22] Id. at 3.
[23] Id.
[24] Id.
[25] Id.
[26] Dwyer, supra note 1.
[27] Purdue Pharma Announces Agreement in Principle on Landmark Opioid Litigation Settlement, Purdue (Sept. 16, 2019) https://www.purduepharma.com/news/2019/09/16/purdue-pharma-announces-agreement-in-principle-on-landmark-opioid-litigation-settlement/.
[28] Id.
[29] Id.
[30] Id.; Dwyer, supra note 1.
[31] Randazzo, supra note 13.
[32] Id.
[33] Id.
[34] Lenny Bernstein, et al., Last-Ditch Opioid Settlement in Ohio Could Open Door for Much Larger Deal, Wash. Post, (Oct. 21, 2019) https://www.washingtonpost.com/health/ohio-counties-drug-firms-reach-260m-settlement-averting-trial/2019/10/21/c9ac1dd4-f39f-11e9-ad8b-85e2aa00b5ce_story.html.
