Case: 1:14-cv-04361 Document #: 478 Filed: 10/25/16 Page 1 of 341 PageID #:13701 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION CITY OF CHICAGO, a municipal corporation, Plaintiff, v. Case No. 14-cv-04361 Honorable Jorge L. Alonso PURDUE PHARMA L.P.; PURDUE PHARMA INC.; THE PURDUE FREDERICK COMPANY, INC.; TEVA PHARMACEUTICALS USA, INC.; CEPHALON, INC.; JOHNSON & JOHNSON; THIRD AMENDED JANSSEN PHARMACEUTICALS, INC.; ORTHO-MCNEIL-JANSSEN COMPLAINT PHARMACEUTICALS, INC. n/k/a JANSSEN PHARMACEUTICALS, INC.; JANSSEN PHARMACEUTICA, INC. n/k/a JANSSEN PHARMACEUTICALS, INC.; DEPOMED, INC.; ENDO HEALTH SOLUTIONS INC.; ENDO JURY TRIAL DEMANDED PHARMACEUTICALS, INC.; ALLERGAN PLC; f/k/a ACTAVIS PLC; ACTAVIS, INC. f/k/a WATSON PHARMACEUTICALS, INC.; WATSON LABORATORIES, INC.; ACTAVIS LLC; and ACTAVIS PHARMA, INC. f/k/a WATSON PHARMA, INC., Defendants. Case: 1:14-cv-04361 Document #: 478 Filed: 10/25/16 Page 2 of 341 PageID #:13702 TABLE OF CONTENTS Page I. INTRODUCTION............................................................................................................. 1 II. PARTIES ......................................................................................................................... 11 A. Plaintiff................................................................................................................. 11 B. Defendants. .......................................................................................................... 12 III. JURISDICTION AND VENUE ..................................................................................... 20 IV. JURY DEMAND ............................................................................................................. 21 V. FACTUAL ALLEGATIONS ......................................................................................... 21 A. The Science behind Pain Medicine. ................................................................... 21 1. Safe and Effective Treatment of Chronic Pain Hinges on Informed Risk Management. .................................................................................... 21 2. The Use of Opioids Is Associated with Known and Substantial Risks. ......................................................................................................... 22 3. The Benefits Offered by Long-Term Opioid Use Are Unproven and Contradicted. ............................................................................................. 27 4. Defendants’ Impact on the Perception and Prescribing of Opioids. ............ 30 B. Defendants Promoted Their Branded Products Through Direct Marketing to Prescribers and Consumers. ....................................................... 32 1. Defendants Relied Upon Branded Advertisements. .................................... 32 2. Defendants Relied Upon Their Sales Forces and Recruited Physician Speakers. ................................................................................................... 33 3. Defendants Directed These Promotional Efforts Through Detailed Marketing Plans. ....................................................................................... 37 a. Targeting categories of prescribers .................................................. 38 b. Increasing “direct to consumer” marketing ..................................... 39 c. Differentiating each brand ............................................................... 39 d. Moving beyond office visits ............................................................ 40 4. Defendants Marketed Opioids in Chicago Using the Same Strategies and Messages They Employed Nationwide. ............................................. 41 C. Defendants Used “Unbranded” Marketing to Evade Regulations and Consumer Protection Laws. ............................................................................... 44 - i - Case: 1:14-cv-04361 Document #: 478 Filed: 10/25/16 Page 3 of 341 PageID #:13703 1. Regulations Governing Branded Promotion Require that it Be Truthful, Balanced, and Supported by Substantial Evidence. .................. 44 2. Defendants Deployed Front Groups and Doctors to Disseminate Unbranded Information on Their Behalf. ................................................. 47 a. Defendants’ Use of KOLs ................................................................ 50 i. Russell Portenoy ............................................................... 53 ii. Lynn Webster .................................................................... 54 b. “Research” That Lacked Supporting Evidence ................................ 56 c. Treatment Guidelines ....................................................................... 58 i. FSMB ................................................................................ 59 ii. AAPM/APS Guidelines .................................................... 60 iii. American Geriatrics Society ............................................. 62 iv. Guidelines That Did Not Receive Defendants’ Support .............................................................................. 63 d. Continuing Medical Education ........................................................ 65 e. Unbranded Patient Education .......................................................... 67 f. Defendants’ Use of Front Groups .................................................... 68 i. American Pain Foundation ............................................... 69 ii. The American Academy of Pain Medicine ....................... 71 3. Defendants Acted In Concert with KOLs and Front Groups in the Creation, Promotion, and Control of Unbranded Marketing. ................... 73 4. Defendants Targeted Vulnerable and Lucrative Populations. ..................... 74 a. The Elderly....................................................................................... 74 b. Veterans ........................................................................................... 75 D. Why Defendants’ Marketing Messages Are Misleading and Unfair. ............ 78 1. Defendants and Their Third-Party Allies Misrepresented that Opioids Improve Function. ....................................................................... 79 2. Defendants and Their Third-Party Allies Concealed the Truth About the Risk of Addiction from Long-Term Opioid Use. ............................... 85 3. Defendants and Their Third-Party Allies Misrepresented that Addiction Risk Can Be Avoided or Managed. ......................................... 96 4. Defendants and their Third-Party Allies Created Confusion By Promoting the Misleading Term “Pseudoaddiction.” ............................... 98 5. Defendants and their Third-Party Allies Claimed Withdrawal is Simply Managed. .................................................................................... 100 - ii - Case: 1:14-cv-04361 Document #: 478 Filed: 10/25/16 Page 4 of 341 PageID #:13704 6. Defendants and Their Third-Party Allies Misrepresented that Increased Doses Pose No Significant Additional Risks. ........................ 102 7. Defendants and Their Third-Party Allies Deceptively Omitted or Minimized Adverse Effects of Opioids and Overstated the Risks of Alternative Forms of Pain Treatment. .................................................... 105 8. Purdue Misleadingly Promoted OxyContin as Providing 12 Hours of Pain Relief. .............................................................................................. 109 E. Each Defendant Engaged in Deceptive Marketing, Both Branded and Unbranded, that Targeted and Reached Chicago Prescribers. .................... 113 1. Actavis ....................................................................................................... 114 a. Actavis’s Deceptive Direct Marketing ........................................... 115 i. Actavis’s Deceptive Sales Training ................................ 116 ii. Actavis’s Deceptive Speakers Training .......................... 121 b. Actavis’s Deceptive Statements to Chicago Prescribers and Patients ........................................................................................ 123 2. Cephalon .................................................................................................... 128 a. Cephalon’s Deceptive Direct Marketing ....................................... 129 i. Cephalon’s Fraudulent Off-Label Marketing of Actiq and Fentora ....................................................... 129 (a) Cephalon launched its fraudulent marketing scheme for Actiq ................................................. 130 (b) October 1, 2006—Cephalon fraudulently marketed Actiq’s successor drug, Fentora .......... 131 (c) September 2007—Reports of death and serious side effects led the FDA to issue a public health warning for Fentora ....................... 134 (d) May 6, 2008—The FDA rejected Cephalon’s request for expanded approval of Fentora ............................................................ 135 (e) March 26, 2009—the FDA’s Division of Drug Marketing, Advertising and Communications (“DDMAC”) warned Cephalon about its misleading advertising of Fentora ................................................................ 136 (f) Cephalon continues to knowingly, deceptively, and illegally promote Fentora for off-label uses ................................................. 137 - iii - Case: 1:14-cv-04361 Document #: 478 Filed: 10/25/16 Page 5 of 341 PageID #:13705 ii. Cephalon’s Misrepresentation of the Risks Associated with the Use of Opioids for the Long- Term Treatment of Chronic