Teva Pharmaceuticals Found Liable in Landmark Opioid Trial – The New York Times
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The case was the first of its kind, targeting every point of the prescription opioid supply chain, from manufacturers to pharmacy chains that filled prescriptions.
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A jury on Thursday found that an opioid manufacturer and distributor contributed to the deadly opioid crisis in New York, inundating the state with prescription painkillers that led to thousands of deaths.
The American division of Teva Pharmaceuticals, an Israeli-based company that produces generic and branded opioids, and a handful of subsidiary companies were found liable in a sprawling, six-month trial that sought to reckon with the role that the pharmaceutical industry played in the opioid epidemic in two hard-hit New York counties and across the state.
The case is only the second opioid-related lawsuit to reach a jury verdict, among thousands of similar claims around the country filed by municipalities, tribes and states, who are closely watching these outcomes for hints about how to proceed in their own cases.
Last month, a federal jury in Ohio found three retail pharmacy chains liable for their role in the epidemic. But the New York trial is the first to include different types of companies in the opioid supply chain.
Jurors also said that New York State, which is supposed to enforce controlled substances laws, bore a modest portion of responsibility.
Lawyers for the state and the two counties, both on Long Island, had argued that the companies helped perpetuate a “public nuisance,” a legal claim that refers to a substantial, ongoing interference with a public right.
They accused Teva and its subsidiaries of downplaying the drugs’ addiction risk, marketing opioids for unapproved uses and failing to adhere to internal safeguards that are intended to prevent the drugs from flooding the market.
In recent years, public nuisance claims have been more typically applied in environmental pollution cases. But the expanded use in the public health domain, notably in the opioid cases and in accruing cases against makers of e-cigarettes, will almost certainly be taken up by appellate courts.
The trial was held on Long Island, where between 2010 and 2018, the rate of overdose deaths involving any opioid more than doubled, according to state data. In 2019, opioid overdose deaths climbed above 1,600 in Nassau County and rose above 3,000 in Suffolk County, according to data from the Centers for Disease Control and Prevention.
The amount that Teva and its companies will have to pay will be assessed at the so-called abatement phase of the trial, sometime in 2022.
“While no amount of money will ever compensate for the human suffering, the addiction, or the lives lost due to opioid abuse, we will immediately push to move forward with a trial to determine how much Teva and others will pay,” Letitia James, the state attorney general, said in a statement.
Jayne Conroy, a lawyer in private practice who represents Suffolk County and who has pursued opioid litigation for more than two decades, said the verdict was a just end to a complex case.
“After months of testimony and evidence, we have proven to a jury that both Teva and Anda have significantly contributed to this tragic epidemic,” Ms. Conroy said. “Hopefully we can begin to heal.”
The trial began at the end of June with more than two dozen defendants, including pharmaceutical companies that manufactured pain pills, distributors of the drugs and the pharmacy chains that filled the prescriptions.
The case was so vast initially that the trial was to be held in an auditorium at a Long Island law school. There was not a courtroom in Central Islip large enough to fit all the defendants and their legal teams.
Noting that the case was filed years ago, New York State Supreme Court Justice Jerry Garguilo added, “The trial itself has touched four seasons. We started in the spring. We went to the summer, we went to the fall and of course now we’re into the winter.” In total, he said, “It was an ultramarathon.”
As the months passed, defendants began to settle.
Defendants are always weighing whether to settle a case or take their chances with a jury, or even an appellate court. Days before the New York trial began, Johnson & Johnson agreed to pay $230 million, and as the months wore on, almost all defendants in the sweeping case agreed to multimillion-dollar settlements.
They included three major drug distributors, who settled in July for more than $1 billion combined. That settlement was part of a larger $26 billion agreement to which companies facing lawsuits for their role in the opioid crisis agreed to settle the raft of more than 3,000 lawsuits filed against them.
As the trial was coming to a finish, there were more settlements: Earlier this month, Allergan, a pharmaceutical company whose best-known product is Botox, was excised after it agreed to a $200 million settlement.
The money from the settlements will be spread to communities hit by the epidemic of opioids to use for addiction treatment and prevention programs. If certain conditions are met, the combined amount could reach $1.5 billion.
By the time closing arguments began, only a handful of defendants remained, all affiliated with Teva, which chose to take its chances with jurors.
The six-member jury was asked to determine whether the companies had played a role in perpetuating the opioid crisis in New York. Statistics suggest that the crisis has only worsened during the pandemic. Nationally, more than 100,000 people — a record number — died last year from overdosing on opioids, particularly black-market fentanyl, according to the C.D.C.’s provisional 2020 data.
The verdict was the third decided against a pharmaceutical company in the nationwide opioid litigation.
In the first, a 2019 bench trial brought by Oklahoma against Johnson & Johnson, a judge found in favor of the state. In the second, brought by two Ohio counties against national retail pharmacy chains, a federal jury found three companies liable.
But the litigation has had inconsistent outcomes, even for the same defendants. Elizabeth Burch, a University of Georgia law professor, called Thursday’s verdict “a pretty significant win,” especially in light of some recent setbacks for plaintiffs.
Last month, Oklahoma’s top court threw out a ruling that required Johnson & Johnson to pay the state for its role in the opioid epidemic. And in California, a state judge rejected the argument that opioid manufacturers, including Teva, contributed substantially to the opioid crisis in several counties.
The pharmacy chains in the Ohio case have already begun their appeals. And Teva, noting that the California judge ruled in its favor, has also said that it would appeal the ruling in New York.
A spokeswoman for the company said that the plaintiffs had “presented no evidence of medically unnecessary prescriptions, suspicious or diverted orders, no evidence of oversupply by the defendants — or any indication of what volumes were appropriate — and no causal relationship between Teva’s conduct including its marketing and any harm to the public in the state.”
Teva also announced that it would continue to seek a mistrial, in part because it said that plaintiffs’ lawyers had mischaracterized internal company videos as training instruction.
In the videos, sales executives parodied movie villains. In one, an executive, in the voice of the “Austin Powers” villain Dr. Evil, discusses pressing doctors to prescribe the company’s drugs over a competitor’s product. In a takeoff of “A Few Good Men,” a sales vice president said that representatives had quotas: “You can’t handle the truth,” he says. “Quotas have to be exceeded.”
Teva’s lawyers said the videos were intended as humorous spoofs, to enliven internal meetings.
Jurors deliberated for 9 days, wrestling with a series of complicated questions. They were asked to apportion responsibility among all defendants — even those that had already settled. And they had to determine blame among defendants separately for each of the two counties as well as the state.
In the end, the jury did not hold liable any of the defendants who had reached settlements. It placed almost all of the blame on the companies that had insisted on seeing the trial through to verdict.
Although the jury did not find that Nassau and Suffolk counties bore any responsibility for the epidemic, it did assign New York State 10 percent of the responsibility. The state is supposed to maintain its own rigorous safeguards for monitoring excessive pill orders.
Hunter Shkolnik, a lawyer for Nassau County, said the evidence presented at trial needed to be revealed so that the public could understand the company’s role in the crisis.
“Videos of sales meetings where they laughed, and they joked about the use of drugs like fentanyl that kill people, and how they owned the market and they made the markets,” Mr. Shkolnik said. “This is what the public needs to see.”
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