A Delaware federal trial court trimmed much of the Justice Department’s ambitious civil lawsuit against Walmart in connection with the opioid crisis last month, and in so doing spotlighted the politics that seem to infect the case.
U.S. District Judge Colm Connolly dismissed claims requesting civil monetary penalties and injunctive relief for Walmart’s and its pharmacists’ alleged failures to report suspicious orders to the Drug Enforcement Agency (DEA) and document resolution of “red flags” prior to filling prescriptions. Litigation will proceed on claims seeking to hold Walmart responsible for pharmacists filling improper prescriptions with the alleged knowledge of a member of the compliance department but without knowledge of the pharmacists, and with the alleged knowledge of the pharmacists who filled the prescriptions (not challenged in Walmart’s motion to dismiss).
This litigation has been curious from the start. The lawsuit was filed after a roiling internal debate about bringing an eventually aborted criminal case. The claims in the civil suit impermissibly stretch the law for reasons Judge Connolly explained. The department’s campaign against opioid suppliers and distributors is misguided and unresponsive to the causes of the addiction crisis that has gripped the country.
The government may have a difficult time proving the claim that survived dismissal. This count seeks to hold Walmart responsible for pharmacists allegedly dispensing controlled substances in response to illegitimately written prescriptions. These actions occurred, the Justice Department asserts, with knowledge of one or more compliance department members but without knowledge of the pharmacists themselves. Walmart argued that under agency law, liability cannot stem from combining a member of the compliance department’s knowledge with pharmacists’ unknowing actions.
Judge Connolly disagreed, citing an obscure 1918 case, Browning v. Fidelity Trust Co., 250 F. 321 (3d Cir. 1918), for the premise that knowledge of one employee can be aggregated with the act of another employee to establish corporate liability. In Browning, the court interpreted the impact of an immunity clause on a suit for breach of fiduciary duty.
However, the plain language of 21 C.F.R. § 1306.4(a) on which the Justice Department relies, explicitly requires that a pharmacist know a prescription is faulty to generate liability. Whether the purported knowledge of compliance department employees can be imputed to pharmacists to create corporate liability under this regulation is questionable.
Although federal law and regulations make it illegal for pharmacies to fill prescriptions that are not written for “a legitimate medical purpose” by a practitioner “acting in the usual course of his professional practice,” the Justice Department cannot show compliance staff knew individual prescriptions were invalid. (21 U.S.C. §§ 842(a)(l) and 829[(a) and (b)],and 21 C.F.R. § 1306.04(a)). Rather, compliance staff study patterns not specific prescriptions, and appear to lack access to individual patient or prescriber information. Therefore, even if compliance department knowledge can be ascribed to pharmacists, it may prove insufficiently detailed to serve as the basis for liability.
The case’s inherent weakness and uncertain prospects argue against the notion of targeting chain pharmacies in the first place. The opioid epidemic has its roots in 1990s liberalization of medical attitudes toward the use of opiates for management of mild to moderate pain, with underestimation of the risks of opioid abuse. Concomitant with these trends, manufacturers aggressively marketed opioid drugs.
By contrast, pharmacies dispense medicines in accordance with legally mandated prescriptions. Giving pharmacies undue responsibility to police physicians’ medical decisions is unreasonable and potentially interferes with patient access to beneficial therapies. There should be a high bar for finding drugstores complicit in poor physician judgment or illegitimate actions.
Excessive blame for opioid overdose deaths has been placed on prescription medicine suppliers generally. These deaths are mostly attributable to illegally imported Chinese fentanyl, which enters the United States via our porous southern border. Consequently, opioid deaths have increased despite tighter prescribing habits in response to heightened physician monitoring and enforcement, cultural change, and lowered manufacturers’ production quotas.
Popular accounts also inadequately capture the role of federal regulators in fostering the opioid addiction crisis. For example, the Obama-era DEA raised opioid production quotas year-after-year, while failing to police bad faith prescribers and paying insufficient attention to the dramatic increase in fentanyl deaths.
Well-intentioned liberalization of criminal deterrence in select jurisdictions may also be a contributing factor. Instead, treatment focused approaches – often coerced - are essential to prevent unnecessary deaths.
Oregon is retreating from its audacious experiment in drug decriminalization after overdose deaths skyrocketed. Gov. Tina Kotek (D.) has pledged to sign legislation repealing the key components of Measure 110, which abolished criminal penalties for possession of small amounts of drugs like heroin, cocaine, methamphetamine, and – astoundingly - fentanyl. Oregon’s drug overdose death rate increased by 41 percent in 2021, the first year of the law’s implementation, and has continued to climb.
The opioid addiction crisis has evolved from its roots in over-prescription of narcotics into an exceptionally deadly multi-faceted societal ill involving drugs trafficked from China and Mexico and ineffective policy responses. Public health would be better served by addressing these areas, rather than by filing dubious and potentially counterproductive lawsuits against drugstores.
Roger D. Klein, J.D., M.D. is a faculty fellow at the Center for Law, Science & Innovation at the Sandra Day O'Connor College of Law and a policy advisor to the Heartland Institute.
Read Full Article »