New York wraps Allergan and Teva into ongoing opioid abuse probe with new civil charges

Pills in dollar sign (Photo: Eric Palmer)
By marketing opioids for off-label use and downplaying addiction risks, Teva and Allergan collected millions in false insurance claims, New York alleged in civil charges. (Eric Palmer)

New York Governor Andrew Cuomo may have been preoccupied with getting the COVID-19 pandemic under control in his state over the past few months, but that hasn’t stopped him from going after the opioid industry.

New York filed civil charges against Teva and Allergan yesterday alleging the companies violated two state insurance laws by improperly marketing their opioid painkillers. The new charges are being wrapped into an investigation that New York launched last September and that subsequently produced claims against opioid makers Endo and Mallinckrodt.

In the eight years ending in 2014, private insurance claims related to opioid dependence skyrocketed 500% in New York state, according to the charges. The resulting increase in claims paid out by the state’s health insurers forced consumers of commercial health plans to overpay premiums by an estimated $1.8 billion, the charges against Teva and Allergan alleged (PDF).

The state is seeking $5,000 per fraudulent claim under the New York Insurance Law and $5,000 per offense under the New York Financial Services Law.

AbbVie—Allergan’s new owner—and Teva did not immediately respond to requests for comments.

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New York alleged that Cephalon, which Teva acquired in 2011, devised a “master plan” for marketing Actiq off-label to pain-management doctors after the company realized that there was a limited market for the drug’s FDA-approved use in managing cancer pain. In 2002, Cephalon allegedly said in a marketing plan that its main public relations goal was to increase awareness of breakthrough pain among “both cancer patients and chronic non-malignant pain patients, as well as patients suffering from episodic pain such as migraine headaches and sickle cell disease,” according to the charges.

Cephalon ultimately faced four whistleblower actions related to its marketing of Actiq, which it settled by agreeing to pay $375 million to resolve false claims allegations. But even then, the company was “aggressively marketing” another opioid, Fentora, New York alleged. In addition to sponsoring continuing education courses focused on pain, for example, the company backed the publication of a book about living with chronic pain, which stated that opioids give patients “a quality of life we deserve,” and that many people are able to stay on “the same dose of opioid for a long time,” according to the charges.

The statement of charges points out that the book, called Treatment Options, is still available (PDF).

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New York’s claims against AbbVie's Allergan are centered on the opioid Kadian, which was, in fact, approved by the FDA to manage chronic pain over extended periods of time. But the company consistently downplayed its abuse potential, New York alleged. For example, a brochure about the drug that Allergan produced for patients “stated that a need for a ‘dose adjustment’ is the result of tolerance, and ‘not addiction,’” the charges said.

The statement of charges goes on to claim that Allergan was a member of several “front groups” for opioid manufacturers, including the New York State Pain Society and the American Pain Society. Allergan sponsored the New York State Pain Society’s annual meeting in 2013, and it was an exhibitor at the same conference a year before, during which a key opinion leader for the opioid industry “promoted the concept of pseudoaddiction,” according to the charges.

In April, at the height of the coronavirus pandemic, New York postponed a bellwether opioid trial against manufacturers, distributors and pharmacies that included Teva, Endo and Mallinckrodt in the list of defendants. Just before that delay, Mallinckrodt announced that the state had signed off on a $1.6 billion global settlement that would resolve thousands of claims.

Nevertheless, the latest claims against Teva and Allergan are a strong indication that Cuomo is unlikely to let up on his assault against the opioid industry anytime soon. Ultimately, the state hopes to recover $2 billion in insurance over-charges related to opioid prescriptions.

"New York will continue to aggressively investigate the bad actors that caused the opioid crisis—an American tragedy that has taken too many lives and caused irrevocable harm to communities in our state and across the country," Cuomo said in a statement.