Reckitt Benckiser Sued by 42 States for Abusive Practices

LOS ANGELES, Calif. – (June 15, 2017) – Calling the national opioid epidemic a crisis requiring a comprehensive federal response, the Consumer Safety Coalition urged Congress and the Trump administration to set an example for misbehaving drug companies by using the market power of the federal government’s Medicare and Medicaid drug formularies to punish British conglomerate Reckitt Benckiser Group Plc (RB.L) for its alleged gaming of the opioid treatment market.

“Medicare has become the largest payer for opioid pain relievers in the U.S. since the implementation of Medicare Part D in 2006, meaning federal and state governments are increasingly funding the opioid crisis through public and private insurance coverage,” said James Lee, executive director of the Consumer Safety Coalition. “It’s time the federal government uses that enormous leverage to persuade drug manufacturers to become part of the solution to the opioid crisis, not contribute to the problem.”

In 2015, the most recent year for which national statistics are available, 52,404 Americans died of overdoses — more than the number of deaths in vehicle crashes and gun-related homicides; averaging over 143 deaths a day, the majority of those involving use of an opioid, Lee said.

Opioid addiction has grown as the availability of both legal and illegal opioids have grown and availability of competing opioid treatment medications has been under threat from unrestrained price hikes and market manipulation from drug manufacturers, Lee added.

Drug companies have used their cash and political power to leverage favorable reimbursement rates and gain key insurance payment approvals as outlined in recent reporting by the Associated Press and the Center for Public Integrity which found drug makers and allied advocacy groups hired an annual average of 1,350 lobbyists from 2006 through 2015, doling out millions in campaign contributions.

Lee specifically called out British conglomerate Reckitt Benckiser, formerly the manufacturer of Suboxone, an opioid addiction treatment medication, for significantly contributing to the opioid crisis through “product hopping” to restrict its availability and keep prices high as charged in a lawsuit by 42 state attorney generals.

“Among drug companies, Reckitt Benckiser led the pack in gaming the federal and state insurance regimens to deliver $1.2 billion in annual profits and cornering at one point 85 percent of the opioid drug treatment market, costing taxpayers and putting countless lives at risk,” Lee added.

Lee urged the Trump administration and Congress to take several steps to stem the tide of opioid abuse and send a clear signal to drug manufacturers:

  • Modify regulations enabling states to submit requests to the Centers for Medicare and Medicaid to remove drugs from federal drug formularies if they are removed from a state’s “preferred drug list”;
  • Increase the availability of Medication-Assisted Treatment under the Affordable Care Act (ACA), but enable new regulations prohibiting the listing of opioid treatment medication without comparable generics being available if a product patent has expired;
  • Implement new regulations setting stricter standards for truth in advertising requirements for opioid treatment drug manufacturers through the Federal Trade Commission and Food and Drug Administration extending to allied advocacy groups that receive any funding from drug manufacturers.

“Reckitt Benckiser is not the only drug manufacturer that has engaged in deceptive practices, but it is the only one facing a multi-state lawsuit, which makes it an ideal test case in terms of disclosing documents and information related to the decision-making of its corporate officers,” Lee said. “We believe RB could very well end up being the Phillip Morris of the opioid industry and deliver the same ground-breaking settlements that reshaped the fight over smoking.”

Lee pointed out that two other federal investigations against Reckitt Benckiser were also still ongoing including a FTC investigation into whether Reckitt Benckiser abused public regulatory processes and a Department of Justice probe into the company’s Suboxone business.

With Reckitt Benckiser’s recent acquisition of Mead Johnson Nutrition Co., scrutiny of Reckitt Benckiser’s corporate decision making becomes crucial now that it stands to control a sizable portion of the baby food market affecting the health and welfare of children worldwide.

The Consumer Safety Coalition

The Consumer Safety Coalition was founded to serve as a clearinghouse and source of information for consumers, regulatory officials and news media on the business practices of companies endangering consumers and the environment. The CSC works with other consumer groups and activists to identify, research and explain harmful business practices companies undertake. Those practices may include issues related to counterfeiting goods, intellectual property theft, environmental hazards, work place and product safety. For more information, please go to

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