The Opioid Crisis Reflects Larger Big Pharma Norms

Prescription opioid overdoses have claimed more than 200,000 lives in the United States over the last decade, ravaging countless towns and cities and emerging as a case study for some of the worst corporate abuse in years.

The suspects — companies like Purdue Pharma and Johnson & Johnson — are finally facing legal accountability for their role in creating and perpetuating the addiction epidemic that is now more likely to kill Americans than car accidents and has killed more people than HIV/AIDS and the 9/11 attacks. An Oklahoma judge recently ruled against Johnson & Johnson, the world’s largest producer of pharmaceuticals, fining the company $572 million for its culpability in the state’s opioid epidemic.

The Oklahoma lawsuit against Johnson & Johnson was the first U.S. case to hold a drug corporation directly responsible for the opioid epidemic, but the $572 million in damages ordered by the judge was a small fraction of $17 billion in penalties requested by the state. It fell far short of the $1 billion fine that most investors were expecting.

Shareholders breathed a sigh of relief as the company’s stock rallied and share prices increased in the days following the decision. This outcome should make us adjust expectations for the upcoming Ohio trial featuring 2,300 plaintiffs.

Other settlements with Purdue, Johnson & Johnson and other major opioid manufacturers may eventually provide thousands of plaintiffs with compensation. That’s a positive step, but no amount of money can rectify the lasting damage inflicted on families and communities impacted by the epidemic, nor will fines force the kind of system change required to fix today’s opioid mess and prevent similar crises in the future.

Courts of law can punish drug companies for the aftermath of harmful action, but they will not alter the conditions that made the opioid crisis possible. Corporations and their shareholders will continue to enjoy profits as long as the status quo remains intact. The only way to ensure fair treatment for patients is for lawmakers to take serious action to change the rules.

The opioid crisis is a culmination, not an aberration, of the prescription drug industry’s business model. Essentially, the opioid epidemic is a cautionary tale that points to what we can expect if lawmakers don’t take meaningful action to rein in drug corporations’ power to set prices, gouge patients and boost profits at the expense of people’s lives.

The courts won’t stop drug corporations’ aggressive marketing of medicines, a key factor in jump-starting the frenzy of prescriptions than led to the opioid epidemic. Drug companies routinely spend far more on marketing and advertising than on research and development, despite the industry’s claims to the contrary.

Between 1997 and 2016, industry spending on marketing increased from $17.7 billion to $29.9 billion. A significant portion of this advertising — $6 billion in 2015 — is taxpayer subsidized.

The Oklahoma judge found that Johnson & Johnson leveraged distorted claims about low addiction of opioid pain medicines in their marketing to doctors in order to misrepresent these drugs as safe. Research shows that in counties where drug corporations spent more opioid-related marketing dollars, doctors prescribed drugs at a higher rate and ultimately, more overdose deaths occurred than in counties with less marketing.

Whether it’s opioids or a different class of medicine, drugmaker profits are ensured through monopolies created by the patent system that eliminates competition and guarantees companies can set whatever price they want for a drug and then keep that price high for an extended period. Patent abuse has helped drugmaker protfits between 2006 and 2015 outpace profit in nearly all other industries.

Purdue Pharma, the makers of OxyContin, took advantage of the monopoly model to extend its patent on the drug, which was supposed to expire in 2013. Purdue tweaked the drug over a dozen times to hold on to its exclusive right to market and sell it until 2030. Purdue generated billions in revenue while marketing the tweaks as improvements in drug safety.

The opioid epidemic is high profile, but nothing that the opioid drug corporations have done to reap massive profits from it is essentially new or unusual. In fact, the opioid companies just doubled down on the existing Big Pharma industry norms — aggressive marketing, extending monopolies, tweaking patents and prioritizing shareholder returns — to maximize profit.

The courts are stepping up accountability for past harm from some of these companies, but that won’t ensure a different future. Democratic leadership in the House recently proposed a drug plan that would help rein in pharmaceutical giants. Congress should take the first step to change the rules and incentives in the current system. Then it should build on it with bolder reform to rein in monopolies, limit marketing and enforce corporate accountability.

It’s time for our elected officials and the president to protect patients above profits and fix the broken system.


Margarida Jorge is executive director of Health Care for America Now and a key leader in the progressive coalition Lower Drug Prices Now. 

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