Ottawa and provincial governments have reached a $150-million settlement with Purdue Pharma (Canada) to recover health care costs associated with what they allege are deceptive marketing practices the company used to sell opioid medications, contributing to increased rates of addiction and overdose.
B.C. Attorney-General David Eby, whose province spearheaded the effort to recoup such costs with a lawsuit launched in 2018, said it is the largest settlement of a governmental health claim in Canadian history and paves the way for future agreements in the continuing litigation against other opioid manufacturers and distributors.
The settlement is still subject to final approval by the courts, which is expected in coming months. The allegations against Purdue Canada have not been proven in court.
“No amount of money will bring back those we lost to overdose,” Mr. Eby said on Wednesday in Vancouver. “However, this settlement provides a significant recovery in lieu of lawsuits or the uncertainty of bankruptcy claims. It offers finality for government and for Purdue Canada.”
“Holding multinational pharmaceutical companies and their consultants to account for their role in this public-health emergency is the right thing to do.”
The proposed settlement reflects a tiny fraction of the opioid-related claims amounting to US$67.4-billion ($86.8-billion) that all 10 provinces filed in a U.S. court in 2020, revealing for the first time how much they have spent fighting an epidemic that has killed thousands of people and devastated communities across the country.
Their claims were among thousands of lawsuits brought in the U.S. by state and local governments, hospitals and individuals against Purdue’s parent company. The provinces were attempting to recover public health care costs associated with an addiction and overdose crisis that traces its roots to 26 years ago, when Purdue introduced the prescription painkiller, OxyContin.
Purdue pulled OxyContin from the market in 2012, shortly before the patent was to expire. A host of other, stronger drugs filled the void, including illicit fentanyl, which is responsible for a majority of overdose deaths. An increasingly toxic supply of illicit drugs has contributed to a worsening crisis in Canada.
B.C. launched a class-action lawsuit in 2018 on behalf of federal, provincial and territorial governments in Canada against dozens of players in the opioid industry, alleging years of misinformation and deception by pharmaceutical firms and distributors that knew, or should have known, that the drugs were addictive and contributing to an increase in overdoses. The legal action targeted more than 40 manufacturers and distributors, including Purdue Canada, Shoppers Drug Mart Inc. and the Jean Coutu Group (PJC) Inc.
In September, 2019, Purdue filed for bankruptcy in the U.S., which paused all lawsuits against the company. As part of an agreement that a U.S. bankruptcy judge approved in August, 2021, the provinces began pursuing their claims in Canada instead of in the U.S.
Reidar Mogerman, a Vancouver lawyer representing the B.C. government, told The Globe and Mail that the provinces agreed to accept such a small settlement relative to the size of their claims because they were facing a “very complicated and uncertain bankruptcy process” on both sides of the Canada-U.S. border.
“The bird in hand here is really valuable,” Mr. Mogerman said. “The [opioid] crisis is present and playing out.”
Mr. Eby said the settlement announced Wednesday comes in the context of the legal action led by his province, which continues and is scheduled for a certification hearing in the fall of 2023. He credited B.C.’s efforts for the resulting settlement amount.
Mr. Mogerman said the settlement also paves the way for the provinces to pursue claims against other makers or distributors of opioids.
“It signals to the remaining defendants that the governments are still coming after them, and they intend to pursue the case to the end if necessary,” he said.
The federal government did not file a claim in the U.S. court, but it is included in the proposed settlement, Mr. Mogerman said.
A 2015 study by researchers at the University of British Columbia (UBC) found that pharmaceutical opioids appeared to be overprescribed in some regions of the province, in correlation with higher rates of overdose and death. The UBC researchers collected data from 79 local health areas from 2004 to 2013, and found that the areas with the highest volumes of prescribed opioid purchases were also the areas with the most overdose deaths involving prescribed opioids, according to the study published in Medical Care.
However, experts have said that prescribed opioids are not the driver of the toxic drug crisis that Canada now finds itself in, and that prescribers who abruptly cut patients off regulated opioids may have increased harms by pushing them toward an illicit supply that has become increasingly volatile since 2016.
Thomas Kerr, professor and head of the Division of Social Medicine at UBC and director of research at the British Columbia Centre on Substance Use, said the narrative that prescription opioids fuelled the current crisis – while true in some places, including Ontario – is not the case in B.C.
“We have had a well-established heroin market for an incredibly long time, being on the Pacific Rim, very close to many source countries,” Prof. Kerr said. “We do have some data that when OxyContin was delisted, there was a rise in other prescription opioid misuse, and heroin misuse. It may have helped fuel more heavy, high-risk opioid use but the game really changed in 2016 when we started seeing more and more illegally manufactured synthetic opioids, like fentanyl.”
The BC Coroners Service identified non-pharmaceutical, illicit substances as the cause of thousands of deaths in the province and has called for the expansion of programs to provide regulated drugs, as recommended in March by its death review panel.
“There is a critical need to provide people in B.C. with access to a safer, regulated supply of substances that will reduce reliance on the highly volatile, unpredictable and toxic illicit drug market which has taken the lives of so many of our community members,” reads a statement provided by spokesperson Ryan Panton.
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