Drug company prepares to pay up to $4.5M to Illinois in opioid marketing lawsuit
August 9, 2017

Drug company prepares to pay up to $4.5M to Illinois in opioid marketing lawsuit

Illinois has sued a pharmaceutical company over opioid marketing, yet state lawmakers refuse to reform a workers’ compensation system that encourages the overprescription of dangerous drugs.

Update: Illinois Attorney General Lisa Madigan confirmed Aug. 18 that Insys Therapeutics Inc. has agreed to pay the state of Illinois $4.45 million to settle the state’s lawsuit alleging the drug company deceptively marketed and sold its opioid medication, Subsys, for treatments not approved by the federal Food and Drug Administration. Madigan’s press release said the attorney general’s office “will use the $4.45 million from the settlement to address the significant increase in opioid abuse in communities throughout Illinois.”

In its Aug. 3 report of its second quarter financial results, Arizona-based pharmaceutical company Insys Therapeutics Inc. noted it was taking “[c]harges related to litigation award and government settlements [of] $4.5 million for the second quarter of 2017 [, which] represent an estimated potential settlement with the State of Illinois.”

Illinois Attorney General Lisa Madigan sued Insys in 2016, alleging the company deceptively marketed and sold Subsys, a fentanyl-based medication, to doctors for off-label uses, according to Reuters.

The drug’s website describes Subsys as a fentanyl spray for “breakthrough cancer pain relief.” The state’s lawsuit alleged, however, that the company didn’t focus its marketing efforts on cancer specialists, but rather on doctors who prescribed large volumes of opioid medications, according to Reuters. “This drug company’s desire for increased profits led it to disregard patients’ health and push addictive opioids for non-FDA approved purposes,” Madigan said in a statement reported by Reuters.

Illinois’ opioid abuse problem is alarming, and has grown worse in recent years. The Centers for Disease Control and Prevention reported in December 2016 that Illinois’ overdose death rate due to synthetic opioids such as fentanyl increased 120 percent from 2014 to 2015. And Crain’s Chicago Business noted that the nonprofit Fair Health has data that show insurance claims filed in connection with opioid abuse and dependence went up 329 percent in Illinois between 2007 and 2014. This crisis is financially costly, and the human toll is incalculable.

But the attorney general’s prosecution of inappropriate marketing of addictive drugs contrasts sharply with the state’s inaction on drug overprescription in its workers’ compensation system.

Overprescription of drugs in Illinois’ workers’ compensation system

Illinois’ workers’ compensation system was put in place to help workers injured on the job to get medical treatment. But the system provides financial incentives to doctors that work against the well-being of injured workers, such as incentives to overprescribe potentially addictive medication such as opioids.

Illinois’ workers’ compensation laws allow doctors not only to prescribe drugs but also to sell them directly to injured workers, rather than having those patients fill the prescriptions at pharmacies. Through a practice known as “repackaging” doctors can sell adjusted dosages of medications at significant markups. Physicians who dispense repackaged drugs are more likely to prescribe certain types of drugs, including opioids.

And when physicians dispense opioids directly to patients, research published in the Journal of Occupational and Environmental Medicine shows they prescribe 3.2 times the quantity of drugs they would otherwise prescribe. That amounts to a significant increase in medication costs, as physician-dispensed drugs account for more than 60 percent of the drug costs covered by workers’ compensation in Illinois, according to data from the Workers Compensation Research Institute.

Data published in the Journal of Occupational and Environmental Medicine further show that workers who receive physician-dispensed opioid medication have an 85 percent higher frequency of days off work, at a total cost to employers (including medical costs and payment of lost wages) of over $22,000 per injury-related event.

But employers aren’t the only ones who bear the costs: Giving medical providers an incentive to overprescribe painkillers can harm patients.

A study by the Centers for Disease Control and Prevention found that a combination of reforms, including a ban on physician dispensing of strong opioids, reduced both opioid abuse and overdose deaths in Florida.

Illinois bill to reform physician dispensing never made it to full House vote

In February, state Rep. Barbara Wheeler, R-Crystal Lake, filed a bill to remove the incentives for doctors to overprescribe medication to workers’ compensation patients. House Bill 2892 would deny reimbursement under the Illinois Workers’ Compensation Act for prescriptions “filled and dispensed outside of a licensed pharmacy.” The bill makes a narrow exception for direct dispensing of medication in cases where a licensed pharmacy is more than 5 miles from the doctor’s office. In those cases, a doctor will be reimbursed only for a supply of medication that lasts for the greater of “72 hours from the date of the injury or 24 hours from the date of first referral to the medical service provider.”

Notwithstanding Illinois’ mounting opioid crisis and the risk that physician dispensing can pose to injured workers – as well as the extra costs this practice imposes on taxpayers who pay for workers’ compensation for government workers – this commonsense reform never made it to a vote on the House floor.

Illinois officials should be consistent: If opioid abuse is a serious problem that threatens Illinoisans’ well-being, lawmakers should root it out of the workers’ compensation system.

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