The Cuomo administration on Tuesday announced plans to file a sweeping $2 billion lawsuit against opioid makers, distributors and pharmacy benefit managers.
The money is meant to benefit health consumers who have borne the broad cost of the effort to fight the opioid epidemic through higher insurance premiums.
Gov. Andrew Cuomo at a news conference called the opioid crisis the result of a system-wide “fraud” in the drug manufacturing trade.
“I’ve seen a number of schemes and frauds, but the opioid scheme is as diabolical, as brazen, as obnoxious and as offensive as anything I’ve seen,” Cuomo said.
“These drug companies knew what they were doing. It was not accidental – it was an industry-wide conspiracy. The damage they have caused has been immeasurable – it has cost thousands of human lives and billions of dollars, and they have gotten away with it for decades,” he said. “These drug companies are not going to get away with murder, and we are taking a series of actions to ensure that they don’t.”
Attorney General Letitia James’s office has filed a separate lawsuit against opioid makers and distributors. Oklahoma last month won a $570 million ruling against Johnsons & Johnsons in an opioid-related case.
The suit the Cuomo administration announced is being led by insurance regulators at the Department of Financial Services, which pointed to the estimated $2 billion overpayment in insurance premiums in the last decade, which it attributed to opioid addiction.
“Any intentional misrepresentation by the manufacturers and distributors of opioids and PBMs would have led to great financial burden for consumers and New York State-licensed health insurers,” said Financial Services Superintendent Linda Lacewell.
“DFS is charged with oversight of New York’s insurance industry and rate review for consumers and express authority to investigate insurance fraud,” Lacewell said. “DFS will use every tool at our disposal to take appropriate action to protect consumers and the health insurance industry in New York.”