Johnson & Johnson To Appeal Flawed Opioid Judgment in Oklahoma

NEW BRUNSWICK, NJ – August 26, 2019: Johnson & Johnson (NYSE: JNJ) and its Janssen Pharmaceutical Companies today announced they will appeal the $572 million civil judgment entered in Cleveland County District Court in the State of Oklahoma’s lawsuit against opioid manufacturers. The Company is confident it has strong grounds to appeal this decision.

The judgment disregards the Company’s compliance with federal and state laws, the unique role its medicines play in the lives of the people who need them, its responsible marketing practices and that since launch, DURAGESIC^®, NUCYNTA^® and NUCYNTA^® ER have accounted for less than one percent of total opioid prescriptions in Oklahoma as well as the United States.

“Janssen did not cause the opioid crisis in Oklahoma, and neither the facts nor the law support this outcome,” said Michael Ullmann, Executive Vice President, General Counsel, Johnson & Johnson. “We recognize the opioid crisis is a tremendously complex public health issue and we have deep sympathy for everyone affected. We are working with partners to find ways to help those in need.”

Judgment Not Consistent with Facts or the Law
The decision in this case is flawed. The State failed to present evidence that the Company’s products or actions caused a public nuisance in Oklahoma. The State’s claims violate fundamental principles of due process by seeking to hold a company liable for conduct permitted under federal law and regulations. It also disregards 100 years of precedent in public nuisance law, which traditionally has been applied to resolve property disputes, not lawsuits involving the sale of goods.

“This judgment is a misapplication of public nuisance law that has already been rejected by judges in other states,” said Ullmann. “The unprecedented award for the State’s ‘abatement plan’ has sweeping ramifications for many industries and bears no relation to the Company’s medicines or conduct.”

Appeal Process and Other Litigation
The Company will move to stay enforcement of the judgment pending the resolution of its appeal. The length of the appeal process varies from case to case, taking into account time for post-trial motions, preparation of the trial record and briefing to the appellate court. In this case, it is anticipated to extend into 2021. The Company is confident it has strong grounds for appeal.

The opinion in Oklahoma does not have a binding impact on other courts, including those involved in ongoing federal litigation, litigation in other states, or how the Company approaches those matters given the different laws, defendants and claims in these other cases. The upcoming federal multidistrict litigation (MDL) currently scheduled for October 2019 includes multiple defendants and a number of different claims. The Company remains open to viable options to resolve these cases, including through settlement.

Janssen Prescription Pain Medicines
In addition to the legal deficiencies of the State’s case, the facts do not align with or support the outcome of the trial. Janssen developed two types of Schedule II prescription opioid medicines – a patch and a crush-resistant tablet – designed to help patients suffering from severe pain. DURAGESIC^®, NUCYNTA^® and NUCYNTA^® ER are U.S. Food and Drug Administration (FDA)-approved and since launch, have accounted for less than one percent of total opioid prescriptions in Oklahoma as well as the United States. The FDA-approved labels of these medicines provide clear information about their risks and benefits.

The Centers for Disease Control (CDC) estimates nearly 50 million Americans suffer from chronic pain. These patients should not be ignored.

Former Johnson & Johnson Affiliates
Several of the State’s allegations focused on Noramco and Tasmanian Alkaloids, former affiliates of Johnson & Johnson, that produced and supplied medical-grade ingredients for opioid pain medications. At every stage of the supply chain, these companies were governed by and complied with international and federal regulations and quotas. These included importation and manufacturing quotas established by the U.S. Drug Enforcement Administration (DEA) and FDA. The State did not contest that these affiliates complied with the regulations at all times.

Importantly, as suppliers, these former affiliates played no role in the manufacturing, sales or marketing of the finished products of other DEA-regulated manufacturers. Johnson & Johnson sold Noramco and Tasmanian Alkaloids in 2016.

Oklahoma law bars liability for the supply of these raw materials, and a comprehensive federal regulatory program authorized and painstakingly regulated the importation, manufacture and sales of those materials.

Johnson & Johnson Response to the Opioid Crisis
The opioid crisis is a complex public health issue that demands a public health response. The Company continues to collaborate to help patients, families and communities in need.

Building on our legacy in public health, we are working with frontline health care professionals, academic institutions, policymakers, online communities and others to address the unmet needs of those impacted by this crisis. To date, the Company has sponsored independently developed education programs for tens of thousands of doctors, nurses and pharmacists across America, helping to better equip them to fight substance abuse and addiction. The Company is also collaborating with academic institutions to identify evidence-based best practices that can empower nurses and other health care practitioners to effectively respond to the opioid crisis at the community level. Based on more than 130 years of experience, these collaborations are where the Company can have the greatest impact.