The recent settlement in a US government lawsuit against opioid maker Purdue Pharma and the company that allegedly consulted about boosting its sales is what the BC lawyer general feels “with his heart” in pursuing a similar lawsuit in Canada.
On Monday, 55 US states and territories reached a US$7.5 billion settlement with Purdue, the maker of OxyContin, and members of the Sackler family who tried to hold them accountable for their contributions to the opioid overdose crisis.
As part of the settlement, Sackler will waive control of the bankrupt company and will be banned from selling prescription opioids in the future.
Local governments, drug addicts and other affected groups must vote to accept the deal by the end of September, a federal judge ruled Friday.
The announcement of the US settlement comes after the BC Supreme Court found a state class action lawsuit against McKinsey & Company last Friday. McKinsey & Company has been accused of advising Purdue and other pharmaceutical companies on how to sell opioid products in Canada.
McKinsey has already led to the prison of McKinsey executives as he had to pay more than US$1 billion to resolve similar lawsuits in the United States.
“I'm really pleased with the momentum,” BC Attorney General Niki Sharma told Global News in an interview.
“My job as Attorney General is to make sure I pursue it as proactively and quickly as possible. So I am very committed to success in the province and will continue to lead the charges in Canada.”
The BC lawsuit against McKinsey is separate from the larger class action lawsuit against numerous opioid manufacturers and distributors on allegations that downplayed the risks the products pose to earn profits. The lawsuit was allowed to move forward last fall and was certified in January.
BC is leading both lawsuits on behalf of other Canadian provinces and regional and federal governments with the aim of recovering healthcare costs involved in responding to the overdose crisis, Sharma said.
“We think it's unfair that companies that are making so many benefits knowing that their products are very harmful and that causes this level of addiction, and that companies are not paying the costs of healthcare,” she said.
A spokesman for McKinsey told Global News that he intends to protect himself from lawsuits that say the company has no merit.
“McKinsey did not undertake work in Canada to enhance opioid sales or marketing,” the spokesperson said in an email.
Tactical claims for the sale of “turbocharged” opioids
BC's lawsuit against McKinsey alleges that Canadian Purdue subsidiaries, as well as Johnson & Johnson, Janssen and other drug makers, have adopted many of the same tactics that the US parent company uses to increase sales.
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The BC Supreme Court said that multinationals often decided to apply their business and marketing strategies “universally” when certifying their cases.
Last December, McKinsey agreed to pay $650 million to resolve a U.S. Department of Justice lawsuit focused on the company's work with Purdue, including an allegation that McKinsey advised on measures to “turbocharge” the sale of Oxycontin.
Martin Elling, a former senior partner at McKinsey who worked on Purdue's issues, has been sentenced to six months in prison after pleading guilty to obstruction of justice in connection with the case.
The federal settlement agreed to McKinsey's total of USD 641 million to pay in 2021 and to settle similar claims filed by the U.S. Attorney General.
A total of federal and state lawsuits related to the opioid crisis have created a settlement worth around US$50 billion, according to researchers at Johns Hopkins University who track such claims.
Long-term use of prescription painkillers like oxycontin due to dependence contributed to the majority of opioid-related hospitalizations and overdose in the early 2000s in North America. In recent years, illegal opioids like fentanyl have overtaken prescription opioids as the leading drivers of the opioid crisis.
Between 2016 and September, nearly 51,000 Canadians died from opioid-related overdose, according to federal data. BC, which declared a public health emergency in 2016, saw the fatal overdose in any other state during that time, with more than 16,000 deaths.
“I think like many states in this country, we have seen the sacrifices of the opioid crisis not only in the long-term addiction and influence, but also in many people who are grieving the loss of life and the loss of their loved ones,” Sharma said.
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A Health Canada spokesman said the federal government “sees businesses to be responsible for their role in the overdose crisis,” and would continue to work with provinces and regions on BC's legal action.
“The overdose crisis continues to be one of Canada's most pressing public health challenges,” the spokesman said in an email to Global News.
Health Canada is considering and “considering” developments from the recent US Purdue settlement, the statement added.
Where should the money go?
In 2022, BC secured a $150 million settlement on behalf of the Canadian government in a class action lawsuit against Purdue. The settlement was finalised in early 2023, allowing individuals to file claims from the $20 million portion set aside for the victim and their families. This is an ongoing process.
Pending lawsuits against opioid manufacturers and distributors have named Purdue and its various subsidiaries, as well as Canadian companies such as Johnson & Johnson, Janssen, and Loblaw and its subsidiaries shopper Drug Mart. That remains in the lawsuit.
A researcher who wrote on International Drug Policy earlier this year has urged the Canadian government to be directly in the fight against the drug crisis, rather than unrelated government costs.
These measures should include funding harm reduction services such as overdose prevention centres and safe drug supplies, such as community organizations working directly with people suffering from addiction, the paper says.
Efforts to track how US state and local governments are spending on opioid settlements have revealed some examples of funding not being used to directly respond to the opioid crisis.
Canada is being urged to avoid similar “pitfalls” by requiring at least 85% of the funds recovered to be allocated to “opioid repair efforts” and to work directly with community organizations and members affected by addiction.
According to the university, researchers at Johns Hopkins University proposed guidelines on how the US Opioid Settlement Fund should be spent in more than 25 states.
Sharma said the BC lawsuit is structured so that funds recovered by the state are required to go to the healthcare system, but it could evolve depending on the structure of the settlement.
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“As this developed and as opioid cases emerged, there could have been something that could have been linked to organizations that are providing addiction treatment, or something that would have moved directly towards this crisis,” she said.
She pointed to a record $32.5 billion settlement won in March on behalf of the Canadian government as a model for both the state's health-related legal advocacy and the outcomes it can achieve.
“We're really focused on eliminating bad actors,” she said.
“It's really important to make sure you set lines in the sand for what's right and wrong with every company's behavior.”