State AGs Taking Opioid Money While Negotiating Settlements


Imagine that you are a corporation facing lawsuits from a product you make or market that is under investigation for harming the public health. Imagine that for several thousand dollars you could gain access to the very attorneys general who will decide to pursue lawsuits against you.1 That is exactly the case right now with both the Republican Attorneys General Association (RAGA) and Democratic Attorneys General Association (DAGA) and it is perfectly legal.

When lobbyists for such corporations want to donate to the associations that fund attorneys general (AG) political campaigns, and in so doing gain greater access to the AGs, they can readily do so.

For example, when CBS News investigated in 2018, they found that to attend a lavish four-day retreat with state AGs, corporate lobbyists only needed to donate $125,000. At one such retreat on Kiawah Island, South Carolina, lobbyists could golf, play pool and enjoy yoga on the beach, sign up for a dolphin tour and enjoy an open bar with the top law enforcement officials of each state, CBS said.2

Which corporations have donated to the associations? Donors to the associations read like a who’s who of Big Business from gas and oil industry lobbyists to Amazon, Facebook and other tech giants.3 At the Kiawah Island soiree were representatives from Koch Industries, the NRA, big tobacco and payday lenders.4

AG Donations Amount to the Fox Guarding the Hen House

“Buying justice” by donating to AG campaigns is obviously one of the roots of our corrupt political and judicial system in which corporate profits matter more than public health. But, as court settlements for the many victims of the opioid epidemic — families, municipalities, hospitals, local law enforcement, prison systems — draw closer, the buying of justice is especially immoral. Look who has donated to the AG groups in recent years, according to NBC News.5

“RAGA, which represents 24 GOP state attorneys general, got a total of $385,000 from defendants and the pharmaceutical trade association PhRMA between Jan. 1, 2019 and June 30, 2019, according to late June filings. Walmart and PhRMA gave $130,000 apiece, Johnson & Johnson and CVS each donated $50,000 apiece, and Cardinal Health gave $25,000.

DAGA, which represents 27 officials, got a total of $365,000 from defendants and PhRMA during the same time period. The Democratic group received $125,000 from Walmart, $100,000 from Mallinckrodt Pharmaceuticals, $50,000 from PhRMA and CVS, $25,000 from Cardinal Health, and $15,000 from Walgreens.”

The Sackler Family Were Pioneers in Drug Advertising

By now most people have heard of the billionaire Sackler family who, with aggressive marketing and fallacious assurances it was not addictive, turned OxyContin, an opioid sold by its company Purdue Pharma, into the blockbuster killer drug it is today. Fewer people know that the Sackler family’s involvement in unethical pharmaceutical drug marketing goes back at least 50 years.

In the 1960s, Arthur Sackler built a similar franchise to that of Purdue’s OxyContin by promoting Valium for every imaginable ill with no mention of the addiction potential of benzodiazepines.6 This is how The New Yorker reported the marketing in 2017:

“Sackler promoted Valium for such a wide range of uses that, in 1965, a physician writing in the journal Psychosomatics asked, “When do we not use this drug?”

One campaign encouraged doctors to prescribe Valium to people with no psychiatric symptoms whatsoever: “For this kind of patient — with no demonstrable pathology — consider the usefulness of Valium.” Roche, the maker of Valium, had conducted no studies of its addictive potential.”

The opioid epidemic has cost at least 400,000 lives7 in two decades and is probably our greatest pharmaceutical debacle. But benzodiazepine deaths have also become an epidemic, rising 830 percent from 1999 to 2017, with 10,684 U.S. overdose deaths in 2016 — up from 1,135 in 1999, according to government sources.8

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When It Comes to Drug Scandals Follow the Money

News reports this year seem to indicate that justice for the many victims of the opioid epidemic has finally started as lawsuits against Purdue Pharma, other opioid makers and opioid sellers head toward court. But when you read the fine print you find the situation is far from encouraging.

For example, as awareness of the opioid epidemic’s toll built between 2008 and 2016, the Sacklers transferred at least $4 billion from Purdue Pharma to their personal accounts, according to a lawsuit filed by the state of Massachusetts. As much as $10 billion may have been transferred, charges the state of Oregon.9

Purdue Pharma’s recent bankruptcy filing, which was not unexpected, leaves much less for victims than needed or expected, according to Bloomberg.10 Only $4.4 billion in a Purdue bankruptcy would be guaranteed cash and the rest of the money is only an estimate based on future OxyContin sales and insurance payments. But there is another and possibly bigger problem to a fair settlement — the attorneys general themselves.

Will Opioid Settlements Be Tobacco Settlement All Over Again?

The $246 billion Tobacco Master Settlement Agreement of 1998 sounded like justice for victims of Big Tobacco, but it wasn’t at all, says Stat News.11 It:

” … was supposed to support treatment and prevention of smoking. But it mostly wound up covering state budget shortfalls, subsidizing tax cuts, and supporting general services. In fact, according to a report from the Campaign for Tobacco-Free Kids, 20 years after the settlement states had spent only 2.6% of the settlement revenue on smoking prevention and cessation programs.”

Only about 3.5 percent of funds went to tobacco control after the settlement12 and a National Institutes of Health study found spending on tobacco control after the settlement actually fell! Where did the money go? Here is what the Tax Policy Center reports:13

” … six sample states shifted settlement money to many other programs. Michigan allocated much of its settlement pool to a merit scholarship program and, after 2000, used no settlement funds for anti-smoking initiatives. North Carolina initially allocated more than half of its windfall to tobacco growers and communities hurt by the global settlement … other settlement revenues were used to reduce the state’s budget deficit.”

A State Attorney General Grab for Opioid Settlement Money

As the opioid toll grew, some 2,000 opioid lawsuits from harmed municipalities and Native American tribes have been filed in federal court, and U.S. District Judge Dan Polster has sought to consolidate them into one lawsuit.14 You would think that the top state law enforcement officials would laud the move, but just the opposite has happened. The AGs are in fierce opposition to the consolidation, says the Wall Street Journal:15

“In a court filing, the opposing state attorneys general argued the proposed negotiating class intrudes on state sovereignty and interferes with states’ ability to vindicate the rights of their citizens.

‘What we’re encouraging here is a cannibalization by the people who raced to the courthouse,’ Ohio Attorney General Dave Yost said in an interview.”

It must be noted that harmed cities, counties and Native American filed lawsuits in court before the AGs did. As can be expected, local governments strongly defend their right to settlement funds.16 They say they:

” … are at the front lines of the epidemic and are better placed to put settlement money to use. ‘We are the ones answering the 9/11 calls, dealing with overdoses in our library bathrooms, and seeing the impacts on families in our foster care system,’ said Denver City Attorney Kristin Bronson. ‘The casualties have really been felt at the local level.'”

Whose Side Are the State Attorneys General On?

Even if state attorneys general associations were not receiving donations from PhRMA, Johnson & Johnson, CVS, Walgreens, Cardinal Health and Mallinckrodt Pharmaceuticals, their opposition to local communities receiving reparations is inexcusable. Do they plan to use it for their state’s budget shortfalls?

In a New York Times op-ed titled, “Don’t Forget Our Frontline Caregivers in the Opioid Epidemic,” here is what former governor of Ohio John Kasich and Gordon Gee, president of West Virginia University, say about the danger of ignoring local entities such as hospitals:17

While the 1998 tobacco settlement is considered a landmark case in that corporations had to account for the impact their product had on society as a whole and public health care programs in particular, there was one missing component: Hospitals and front line providers were not part of the settlement. Those essential caregivers did not receive funds for the uncompensated care they had to provide as a result of tobacco use.

The federal government recently allocated $2 billion in emergency funds to states and municipalities to help fight the opioid crisis — yet hospitals will receive none of these federal funds.

Hospital emergency rooms are often the first stop for patients with opioid use disorder (although it’s rarely the last). The demands of caring for opioid-addicted patients — from newborns exposed to opioids in the womb to long-term addicts experiencing cardiac infections from IV drug use — have stretched the resources of hospitals. These patients often require intensive, expensive and long-term treatment.”

It is not right that state AGs get dirty money donations from opioid makers. Nor is it right that they knock local communities and caregivers out of their rightful compensation for the opioid deaths.

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