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Risk Managers Take Action on Opioid Liability


News about product liability litigation against a manufacturer of opioids and other litigation involving opioid injury is raising risk manager angst since our last Alert “Six Ways Hospitals and Pharmacies Can Prevent Liability for Over-Prescription of Opioids.”

 

This alert provides analysis and “what this means to risk managers” information you can’t get anywhere else.

 

On Monday, March 4, Purdue Pharma, the maker of OxyContin, was said to be exploring bankruptcy. If it files for Chapter 11 protection, the numerous lawsuits alleging the drug manufacturer used deceptive practices to push addictive drugs that led to fatal overdoses would come to a stop and consumers may no longer have the redress they may be entitled to. A bankruptcy filing would allow Purdue Pharma to negotiate these legal claims under the supervision of a U.S. bankruptcy judge. The litigation may be handled similarly to the claims against the tobacco industry, which resulted in a $246 billion settlement in 1998.

 

NBC News noted the existence of “mounting litigation accusing the pharmaceutical company of misleading doctors and patients about risks associated with prolonged use of its prescription opioids.”

 

In the case of In re National Prescription Opiate Litigation, 2018 WL 6628898 (N.D.Ohio, Dec. 19, 2018) the United States District Court, N.D. Ohio, Eastern Division, allowed the litigation to continue even though it remains to be seen whether the plaintiffs can prove their claims, and denied the defendants’ motions to dismiss. The court stated, “It is accurate to describe the opioid epidemic as a man-made plague, twenty years in the making. The pain, death, and heartache it has wrought cannot be overstated. As this Court has previously stated, it is hard to find anyone in Ohio who does not have a family member, a friend, a parent of a friend, or a child of a friend who has not been affected. Plaintiffs have made very serious accusations, alleging that each of the defendant Manufacturers, Distributors, and Pharmacies bear part of the responsibility for this plague because of their action and inaction in manufacturing and distributing prescription opioids. Plaintiffs allege that Defendants have contributed to the addiction of millions of Americans to these prescription opioids and to the foreseeable result that many of those addicted would turn to street drugs. While these allegations do not fit neatly into the legal theories chosen by Plaintiffs, they fit nevertheless. Whether Plaintiffs can prove any of these allegations remains to be seen, but this Court holds that they will have that opportunity. The Court determined it was not appropriate to grant the defendants’ Motions to Dismiss, and ordered the defendants to file their Answers to Plaintiffs’ Corrected Second Amended Complaint. See also In re Infants Born Opioid-Dependent Products Liability Litigation, 350 F.Supp.3d 1377 (U.S.Jud.Pan.Mult.Lit., Dec. 6, 2018) (the plaintiffs in seven products liability actions filed a motion to centralize the litigation in the Southern District of West Virginia or, alternatively, the Southern District of Illinois; the motion was denied as not warranted because the plaintiffs failed to establish that centralization of a new multidistrict litigation action separate from a multidistrict action filed by cities, counties, and states against manufactures of prescription opioid medications would promote the just and efficient conduct of the actions, given the overlap of legal issues, discovery, and the potential for inconsistent pretrial rulings).

 

A large jury award, including punitive damages, was granted in an action alleging that a physician overprescribed opioids to a patient resulting in the patient’s addiction. The physician’s employer, a hospital, was found vicariously liable. The patient and his wife brought this negligence action and a claim for punitive damages against a physician and the university hospital that employed the physician, alleging that the physician overprescribed opioids to the patient resulting in his addiction. The circuit court denied a request by the physician and hospital for a mistrial during voir dire. The jury returned a verdict for compensatory damages in the amount of $938,000 for the patient, $804,000 for his wife, and punitive damages of $15,000,000, which was affirmed on appeal. The Missouri Court of Appeals, Eastern District, held the probative value of statistics and expert testimony regarding opioid dosage outweighed any prejudice; remarks by the patient's counsel to the jury in voir dire regarding punitive damages did not warrant a mistrial; the evidence of negligence was sufficient to submit the case to the jury; the university hospital was vicariously liable for the patient's injuries; clear and convincing evidence supported the submission of punitive damages to the jury; and the punitive damages claim against the university hospital was submissible to the jury. See: Koon v. Walden, 539 S.W.3d 752 (Mo.App. E.D., Oct. 24, 2017), transfer denied (Mar 06, 2018).

 

What does this mean for risk managers for drug manufacturers, hospitals, and health providers? Continuing litigation means potentially huge defense costs for prolonged litigation or bankruptcy proceedings, and potentially large settlements or jury verdicts.

 

Risk managers should consider:

 

  • Reviewing litigation involving Chapter 11 bankruptcies of manufacturers of allegedly defective pharmaceutical drugs (see, for example, In re New England Compounding Pharmacy, Inc. Products Liability Litigation, 496 B.R. 256 (D.Mass.,2013)) and other resources to determine how the bankruptcy of an opioid drug manufacturer may affect the risk manager’s employer or client and whether settlement of potential liability for an opioid injury is a preferred option to mitigate damages.

 

  • Reviewing litigation resulting in significant jury awards against hospitals and health providers (see, for example, Koon v. Walden, 539 S.W.3d 752 (Mo.App. E.D., Oct. 24, 2017), transfer denied (Mar 06, 2018)) and other resources to determine whether settlement of a claim involving an opioid injury is a preferred option to avoid a potentially large jury verdict or punitive damages.

 

  • Implementing policies and procedures to prevent future liability, such as a program to monitor all opioid prescriptions for excessive dosages, repeat renewals, more than one prescription to the same patient, and other “red flags” specific to the risk manager’s situation.

 

  • Determining, if discovery is requested, whether the policies, procedures, and other internal documents would indicate liability if disclosed during discovery. Or, whether these materials would be privileged from disclosure. (See, for example, Ex parte Mobile Infirmary Association, 2018 WL 2381977 (Ala., 2018) (health center operator's information pertaining to the operator's policies, procedures, training materials, and physician standing orders implemented after an allegedly fatal opioid dose was given was not discoverable; the operator’s “Medical/Healthcare Errors Response Policy,” its “Quality and Patient Safety Program Plan,” and quality-assurance material from its risk management file were found privileged from disclosure because the documents in question were created in direct response to the patient's death or for, among other purposes, enabling the risk management department to carry out its quality-assurance function; disclosure of information related to the operator's accreditation and probation history and to the operator's receipt of sentinel-event alerts were protected from discovery; and communications among the operator's personnel regarding the administration of the drug that allegedly killed the patient and regarding educational materials related to the drug's administration occurred as part of the operator's quality-assurance process, which were privileged from disclosure).

 

Medical Risk Law: Prescription Painkillers: Risks for Patients, Pharmacists, and Physicians provides in-depth law and medical information when you want and need it.

 

Expert Analysis in the above Medical Risk Law, the monthly report on specific medical litigation topics:

 

How Can Physicians, Patients and the Public Be Educated Effectively on Prescription Pain Medication?

Molly Cooke, MD: President, American College of Physicians

 

What Methods of Pain Management Can Be Effective Along with (or Instead of) Prescription Pain Relievers?

Bob Twillman, PhD: Deputy Executive Director and Director of Policy and Advocacy, American Academy of Pain Management

 

How Should Physicians Monitor Patients and Keep Appropriate Documentation?

Michael A. Moroney, JD: Member, Carroll McNulty Kull

 

For Litigation and Discovery Documents, Checklists, Strategies, and other materials on this and other medical litigation, see Medical Risk Law.

 

For more Guidance & Analysis subscribe here Medical Risk Law

 

 

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