Oklahoma Alters Suit Against Opioid Drugmakers Before Trial

By and | April 5, 2019

The state of Oklahoma narrowed its case against drug makers including Johnson & Johnson, Teva Pharmaceutical Industries Ltd. and Allergan Plc, dropping fraud and other allegations while pressing ahead with a public-nuisance claim.

The decision, revealed in a two-page court filing Thursday, comes less than two months before the scheduled start of a trial in Norman, Oklahoma. The state will be the first state in the nation to bring its claims against drug makers. The decision to drop the claims also means the case will be heard solely by a judge, without a jury.

Attorney General Mike Hunter said the move allowed the state to refocus the case “on its central claim, abating the public nuisance caused by the companies’ decades-long fraudulent marketing campaigns.”

“Dismissing the claims without prejudice does not limit the state’s ability to reassert these claims in the future if necessary,” Hunter said in a press release. “Nor does it reduce the amount of damages the state is seeking from the defendants in the lawsuit.”

Endo International Plc bonds rose to as much as 75.8 cents on the dollar, according to Trace bond trading data, even though the painkiller manufacturer isn’t a defendant in the case. J&J’s shares fell $1.60, or more than 1.1 percent, to $135.56 in New York trading.

Billions Less

Oklahoma had been seeking $25 billion in damages and penalties over the opioid makers’ push to lure doctors into prescribing their drugs for unauthorized uses to generate billions of dollars in profits for the companies. Hunter’s decision to streamline the case will chop billions off that request.

The state contends J&J and Teva help create a public-health crisis that has killed thousands of state residents tied to opioid abuse. Oklahoma officials accuse the companies of overstating the painkillers’ benefits and understating their risks in their relentless marketing campaigns that duped doctors into prescribing the drugs for ailments not approved by regulators.

The attorney general also noted dropping the claims eliminates a “blizzard of pre-trial motions” the companies filed in hopes of delaying the case. “The defendants in this case have tried in every way imaginable to derail our trial date,” Hunter said in a statement.

The state last week announced a $270 million settlement with OxyContin-maker Purdue Pharma LP and its controlling Sackler family, resolving civil claims that the illegal marketing of that painkiller devastated local communities.

With the new filing, Oklahoma no longer asserts that the drugmakers violated the state’s Medicaid False Claims Act and Program Integrity Act and were unjustly enriched. It also gave up “past damages stemming from its public nuisance claim.”

“We are pleased that the attorney general dismissed most of the claims, which underscores their lack of merit,” Johnson & Johnson counsel Sabrina Strong said in an emailed statement. Trial evidence will show the company acted appropriately and responsibly, she added.

Allergan declined to comment and a Teva spokesperson didn’t immediately respond. The non-jury trial before Judge Thad Balkman is scheduled to start May 28. He’s denied the companies’ requests to put off the trial and the Oklahoma Supreme Court backed up that decision.

Having a judge — rather than a jury — decide whether J&J and Teva created a public nuisance through their allegedly illegal marketing of their opioid painkillers and how much they should pay to address those problems is good news for the companies, said Jean Eggen, a Widener University law professor who has taught about mass-tort cases.

“Sometimes lawyers can get juries worked up about a case, but a judge is less likely to let emotional reactions effect what he or she hears in the courtroom,” Eggen said. “Judges also take a more statistical approach to what should be paid in a nuisance case, so the companies probably are happy about that.”

The case is State of Oklahoma v. Purdue Pharma LP, CJ-2017-816, Cleveland County, Oklahoma, District Court (Norman).

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