August 27, 2019

A district court judge on Monday ruled that Johnson & Johnson (J&J) helped to fuel Oklahoma's opioid crisis by downplaying the risks of its opioid drugs and ordered the company to pay the state $572 million.

The judge issued the ruling in first U.S. lawsuit filed by a state government that seeks to hold a drugmaker accountable for the deaths and other devastation caused by the opioid epidemic, according to Politico.

Lawsuit details

Oklahoma in the lawsuit argued J&J aggressively marketed opioids that were manufactured by J&J's subsidiary Janssen Pharmaceuticals to providers and patients as safe and effective. For example, the state claimed J&J's sales staff made about 150,000 visits to Oklahoma physicians who were particularly high-volume prescribers, the New York Times reports.

Oklahoma also claimed that J&J fueled the state's opioid epidemic by supplying 60% of opiate ingredients that manufacturers use to produce oxycodone and other opioids, according to the Times.

Oklahoma accused J&J of violating the state's public nuisance laws by substantially interfering with the public health of Oklahoma residents. The state sought a $17 billion judgment—or $893 million a year—to cover the cost of drug courts, substance use disorder treatment, and other services to address the harm caused by the opioid epidemic over the next 20 years.

However, J&J argued that Oklahoma could not show evidence linking the state's opioid epidemic to Janssen, which did not sell the opioids—hydrocodone and oxycodone—that were being diverted in the state. In addition, J&J said Oklahoma failed to identify physicians who had been misled by the Janssen's marketing of opioids. 

Judge sides with Oklahoma, orders $572M in damages

Cleveland County District Judge Thad Balkman in his decision issued Wednesday ruled that J&J had spread "false, misleading, and dangerous marketing campaigns" that "caused exponentially increasing rates of addiction [and] overdose deaths." Balkman determined that J&J had an immense impact on Oklahoma's opioid epidemic even though J&J's share of opioid sales represented about 1% of the market in the state. In addition, Balkman ruled that J&J had breached Oklahoma's "public nuisance" law.

As such, Balkman ordered J&J to pay Oklahoma $572 million, which he said could cover the cost of a year's worth of services the state will need to combat the opioid epidemic.

Some say ruling sets a 'precedent' for other cases

Lawyers representing more than 2,000 cities, counties, and other jurisdictions in similar opioid lawsuits filed throughout the country applauded Balkman's ruling. While the lawyers noted that "public nuisance laws differ in every state," they said Balkman's judgment represents "a critical step forward."

Abbe Gluck, a health policy professor at Yale Law School, explained, "The critical finding is that [J&J] engaged in false, deceptive, and misleading marketing."

Brad Beckworth, Oklahoma's lead attorney, said, "We've shown that J&J was at the root cause of this opioid crisis. It made billions of dollars from it over a 20-year period."

The ruling might influence settlement negotiations in similar cases, Politico reports.

However, Andrew Pollis, a professor at Case Western Reserve University School of Law who closely follows opioid litigation, said, "This is not the eye-popping result that some people expected it to be."

Still, Thomas Cooke, a professor at Georgetown University's McDonough School of Business, said while Balkman's order "may not be the billions [of dollars in damages] that some people were projecting," it sets a "precedent, from the standpoint of the plaintiffs." He added, "Had this verdict been in favor of [J&J], the impact would have been devastating on future cases."

J&J says it plans to appeal ruling

Sabrina Strong, a lawyer for J&J, said, "We have many strong grounds for appeal and we intend to pursue those vigorously." According to the Times, it is unclear whether the appellate courts would affirm Balkman's verdict.

Michael Ullmann, general counsel and EVP at J&J, said, "Janssen did not cause the opioid crisis in Oklahoma, and neither the facts nor the law support this outcome" (Demko, Politico, 8/26; Hoffman, New York Times, 8/26; Bernstein, Washington Post, 8/26; Owens, "Vitals," Axios, 8/27).

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