New Mexico's $24 billion opioid lawsuit against Walgreens goes to judge

Oct. 19—Oral arguments in a civil lawsuit that asks a state court to hold Walgreens responsible for helping create and worsen New Mexico's opioid addiction crisis ended Tuesday after a bench trial that lasted more than seven weeks.

The state Attorney General's Office is asking District Judge Francis J. Mathew to find the retail giant failed to exercise controls over the opioid supply and perform due diligence to prevent diversion, knowingly filling red-flagged prescriptions without investigation and allowed a flood of addictive prescription opioids to enter the state.

New Mexico is asking the judge to order the pharmacy chain to pay about $24 billion dollars over the next 14 years to help "abate" the resulting "public nuisance" of the drug addiction epidemic.

The pharmacies were supposed to act as a dam, Attorney General Hector Balderas said in his opening statement last month, keeping the drugs from flooding the market in "massive surges."

Instead, Balderas said, the defendant's "smashed those dams wide open" — dispensing with safety protocols in a desire to reap historic profits from the sale of opioids. The result: serious harm and sometimes death.

Kroger and Walmart also were named defendants in the trial, but settled about two weeks into the litigation for an amount that is protected by agreement from release until December, said Luis Robles of the Albuquerque firm Robles, Rael and Anaya, one of several lawyers from New Mexico and elsewhere contracted to represent the state.

Written closing arguments in the case are due in 21 days, Robles said, and the judge has suggested but not promised he'll attempt to make a ruling before the end of the calendar year.

CVS and Albertsons settled claims before the trial for amounts that are protected from disclosure until December, Robles said.

The case, which has been pending since 2017, is just one part of a multifaceted nationwide effort by state and local governments to hold prescription drug manufacturers, distributors and retail outlets to account for the part they played in the nation's opioid abuse crisis.

The litigation is the biggest and most complex ever brought in United States' history, Robles said.

There are so many defendants the case had to be bifurcated by category of defendant because COVID-19 protocols limited the number of people who can gather in one courtroom, thus making it impossible to for all the attorneys to attend a consolidated proceeding.

Distributor defendants in the case — including Johnson & Johnson, McKesson and Cardinal Health — settled out of court last year as part of a 600-page nationwide agreement in which they will pay $50 billion dollars to more than 10,000 different governmental entities.

About $190 million of that will come to New Mexico, according to a statement from the Attorney General's Office.

A trial against drugmakers — including Teva, Allergan and KVK-Tech — is slated to begin in March. But Mathew indicated Tuesday there is a possibility it would not go forward if the parties could reach a settlement before then.

Industry giants Purdue Pharma, Insys Therapeutics and Endo Pharmaceuticals have filed for bankruptcy in response to opioid litigation, "and New Mexico continues to pursue them in that forum," according to the Attorney General's Office.

Steven Derringer — a lawyer from the Chicago-based firm of Barlit Beck LLP — said in his closing remarks on behalf of Walgreens many factors contributed to the opiate epidemic and state prosecutors hadn't met their burden of proving the company did anything wrong.

The company met its obligations to create policies and procedures to aid its individual pharmacists in identifying prescriptions that were not issued for legitimate medical purposes, Derringer said.

Those policies "accomplished precisely what the court has said they must ... insofar as they assist our pharmacists in identifying prescriptions that should not be dispensed and they empower our pharmacists not to dispense those prescriptions," he said.

He added that at one point Gov. Michelle Lujan Grisham criticized the policies for making it too difficult for patients with noncancer chronic pain to access prescription pain relief.

"She described our data-gathering requirements of our good faith dispensing policy as being above and beyond any state or federal requirements," Derringer said.

Derringer said much of the evidence presented by the state wasn't specific to New Mexico and said data presented during the trial "is not proof of either improper distribution or dispensing."

Mathew — who could be responsible for directing the spending of any abatement funds awarded in the case — spoke only briefly before recessing the case following closing arguments Tuesday.

His remarks were pointed.

"I've been around long enough to understand that if a crime isn't discovered or prosecuted, that doesn't mean the crime didn't occur," he said.

"In other cases I've had the defense of a blind eye and a deaf ear, and I haven't bought into that defense," he added. "The question I have is: If a company has a policy without enforcement, does it have a policy?"