JOHN D. FERRERO

STARK COUNTY PROSECUTING ATTORNEY

STARK COUNTY FILES LAWSUITS AGAINST

OPIOID MANUFACTURERS AND DISTRIBUTORS

Canton, Ohio (November 14, 2018) – John D. Ferrero, Stark County’s Prosecuting Attorney, announced two lawsuits today in combatting the opioid epidemic. In the suits (separately filed against opioid manufacturers and against opioid distributors), Stark County alleges claims related to the deceptive marketing, distribution and sale of opioids in Stark County.

>From 2007 to 2015, Stark County had more opioid prescriptions than people, each year. In 2016, the prescription rate still remained shockingly high — 92.6 opioid prescriptions for every 100 people (including children) in the County. In just six-years, from 2012 to 2018, opiate-related overdoses have claimed the lives of more than 685 people in the County.

“When the Coroner’s Office requests a cold-storage trailer to accommodate the influx of bodies, we know we have an urgent crisis,” said Ferrero. “Tragically, more people lost their lives in the County than our morgue had room to hold. This request in March of last year was attributed to the opioid and heroin crisis by a 40-year veteran of our public safety department. Unfortunately, our community is one of the hardest hit by the opioid epidemic and this request was yet another disturbing signal to everyone in the County that we have to do what we can to protect our citizens. We bring these suits in hope for accountability and justice for our citizens before the crisis escalates even more.”

Until the mid-1990s, opioids were primarily used to treat short-term acute pain and for palliative (end-of-life) care as it was widely believed that the risks of addiction and other adverse effects largely outweighed any benefit of long-term use.

Causes of action against all defendants are: statutory public nuisance; common law absolute public nuisance; common law qualified public nuisance; negligence; injury through criminal acts; unjust enrichment; and civil conspiracy. Additionally, the County alleges manufacturer defendants Purdue, Teva, Janssen, Endo, and Mallinckrodt, and distributor defendants McKesson, Cardinal and AmerisourceBergen, violated The Ohio Corrupt Practices Act.

“Following the necessary initial investigation into the factors and potential defendants that created and fueled the opioid epidemic in Stark County, it’s time to move forward with these lawsuits, which will ensure that the

people of Stark County are considered within the ongoing litigation and that we can obtain critical resources and create additional programs for our community,” said Ferrero.

Manufacturer Defendants Lawsuit

Manufacturer defendants are alleged to have turned medical practice on its head over the past two decades through a deceptive marketing scheme that was intentionally designed to, and effectively did, change the perception of opioids to permit and encourage the use of opioids long-term for widespread chronic conditions like back pain, migraines, and arthritis.

By the mid-2000s, through marketing that was as pervasive as it was deceptive, opioid manufacturers allegedly targeted health care providers and convinced them to abandon their prior caution by claiming that the risks of long-term opioid use were overblown and that benefits of reduced pain and improved function and quality of life were proven.

The manufacturers’ aggressive and deceptive marketing laid the groundwork for today’s epidemic of opioid addiction, injury, and death by creating a cadre of doctors who looked for pain and treated it with opioids, which in turn created an even broader cohort of patients who expected and easily received opioids.

The actions name manufacturer defendants: Purdue Pharma L.P.; Purdue Pharma, Inc.; The Purdue Frederick Company Inc.; Rhodes Pharmaceuticals L.P.; Teva Pharmaceuticals USA, Inc.; Cephalon, Inc.; Johnson & Johnson; Janssen Pharmaceuticals, Inc.; Ortho-McNeil-Janssen Pharmaceuticals, Inc. n/k/a Janssen Pharmaceuticals Inc.; Janssen Pharmaceutica, Inc. n/k/a Janssen Pharmaceuticals, Inc.; Endo Health Solutions Inc.; Endo Pharmaceuticals, Inc.; Mallinckrodt, LLC; Mallinckrodt, PLC; Specgx LLC; Insys Therapeutics; and Jane Does 1-50.

Specific claims against the manufacturer defendants include:

     Falsely trivialized, mischaracterized and failed to disclose risks, especially the known, serious risks of addiction:

    o Minimizing or mischaracterizing the risk of addiction

    o Falsely described addiction as pseudoaddiction and dangerously encouraged doctors to respond by prescribing more opioids

    o Overstating the efficacy of screening tools

     Overstated the benefits of chronic opioid therapy while failing to disclose the lack of evidence supporting long-term use

    o Mischaracterizing the benefits of and evidence for long-term use

    o Overstating opioids’ effect on patients’ function and quality of life

    o Omitting or mischaracterizing adverse effects of opioids

     Continued to tell doctors that opioids could be taken in ever-higher doses without disclosing their greater risks
 
     Purdue misleadingly promoted OxyContin as supplying 12 hours of pain relief when Purdue knew that, for many patients, it did not
 
     Purdue and Endo overstated the efficacy of abuse-deterrent opioid formulations

    o Purdue’s deceptive marketing of reformulated OxyContin and Hysingla ER

    o Endo’s deceptive marketing of reformulated Opana ER

    - Deliberately disregarded duties to report and terminate suspicious orders and to cease supplying suspicious prescribers

     Insys employed fraudulent, illegal and misleading marketing schemes to promote Subsys

     Purdue misrepresented and defendants hid their lack of cooperation with law enforcement

Distributor Defendants Lawsuit

The County alleges that the distributor defendants also played a significant role in creating the opioid crisis by allegedly taking advantage of growing demand for prescription painkillers. Distributers named in the litigation are accused of flooding Stark County and surrounding communities with opioids without conducting the due diligence required by law to prevent the diversion of opioids to an illicit black market for these drugs that predictably developed.

Defendant distributors have supplied opioids in quantities that they knew or should have known greatly exceeded any legitimate market for opioids—even the wider market for chronic pain created by the manufacturers’ deceptive marketing—and ignored red flags of suspicious orders of these drugs in the County. Distributors consistently failed to report, as required by law, or suspend these illicit orders, deepening the crisis of opioid abuse, addiction, and death in the County.

Distributors also are believed to have had financial incentives to continue to supply opioids to pill mills (doctors, clinics, or pharmacies that prescribe or dispense opioids inappropriately or for non-medical reasons) because they may entitle them to volume-based rebates and discounts that they may then leverage to further increase their sales volumes and profits. As a direct and foreseeable result of the distributors’ conduct, the nation and Stark County are now swept up in what the Centers for Disease Control and Prevention (CDC) has called a “public health epidemic” and what the U.S. Surgeon General has deemed an “urgent health crisis.”

Specific allegations against the distributor defendants include:

     Deliberately disregarded their duties to report and terminate suspicious orders:

    o Distributors have a duty to report suspicious orders and not to ship those orders unless due diligence disproves their suspicions

     Defendants CVS and Walgreens acted not only as wholesalers, but also dispensed prescriptions through their pharmacy stores. They have an obligation to guard against diversion at the pharmacy level as well.

    o Distributors understood the importance of their reporting and due diligence obligations

    o Despite repeated admonitions, defendants have repeatedly violated their reporting and due diligence obligations

     Defendants worked together to sustain their market and boost their profits

     Defendants ignored red flags of abuse and diversion

     Hid their lack of cooperation with law enforcement and falsely claimed to be actively working to prevent diversion

Given numerous red flags, the County claims the distributor defendants should have been on notice that the diversion of opioids was likely occurring in and around Stark County, should have investigated, ceased filling orders for opioids, and reported potential diversion to law enforcement.

Distributor defendants are: Cardinal Health Inc.; McKesson Corporation; Amerisourcebergen Drug Corporation; Walgreens Boots Alliance d/b/a Walgreen Co.; CVS Health Corporation; CVS Indiana L.L.C.; CVS Pharmacy, Inc.; Ohio CVS Stores LLC; and Jane Does 1-50.

Additional Statistics on the Opioid Impact in Stark County:

     Stark County, with an average population from 2010 to 2017 of approximately 375,000, received 203,604,737 retail doses of opioid analgesics, with a high of 27,679,927 in 2013.

    o This is 135 doses per opioid patient

    o Hundreds of people have been rushed to County emergency rooms or revived by EMS or community members trained to administer Narcan — an antidote to overdose.

     In the first five months of 2018 alone, County emergency rooms treated 275 drug overdoses.

     In Stark County, the number of drug-related deaths more than doubled in recent years.

    o In 2012, 42 deaths were attributed to opioids, and another 19 people lost their lives to heroin or fentanyl overdoses.

    o In 2017, 144 people died of opiate-related overdoses.

     In 2017, County emergency rooms reported treating 855 drug overdoses.

    o Further, from January to mid-July of 2018 alone, EMS providers in the County reported administering Narcan 213 times.

     The County has seen a dramatic increase in the number of people seeking addiction treatment due to opioid use.

    o In 2006, the number of clients who received addiction treatment for opioids was 255. In 2016, this number increased to 1,444 clients—a 505% increase.

     The County has expended substantial resources combatting the opioid epidemic, which has placed significant burdens on its social, criminal justice, and emergency response services.

    o Since 2015, it has spent more than $73,000 on Narcan alone.

    o From January 1, 2011 to January 1, 2018, the County health plan spent $235,441.53 on opioid medications.

    o The County has had to pay for opioid prescriptions, related doctor visits, and opioid addiction treatment services through its self-funded health care and workers compensation programs.

The suits are filed in the Court of Common Pleas, Stark County, Ohio. Motley Rice LLC attorneys Linda Singer, Lisa Saltzburg and Elizabeth Smith, along with Donald W. Davis, Adam D. Fuller and Elizabeth Shively Boatwright of Brennan, Manna & Diamond LLC are outside counsel for the County.

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