Big Pharma is having a Big Tobacco moment as litigation over opioids attracts 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, suggests 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.
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, Purdue Pharma spokesman John Puskar said Tuesday that while the company denies the allegations, it shares the state’s “concerns about the opioid crisis.”
“We are committed to working collaboratively to find solutions,” Puskar said.
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 nonfatal 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.”
Even more important than the states are the lawyers behind the complaints, a dream team composed 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.”