On top of hun­dreds of law­suits waged by state and lo­cal gov­ern­ments, sev­er­al ma­jor drug­mak­ers and dis­trib­u­tors are now fac­ing a fed­er­al crim­i­nal probe for their role in per­pet­u­at­ing the opi­oid cri­sis.

Fed­er­al pros­e­cu­tors in Brook­lyn are in­ves­ti­gat­ing whether phar­ma com­pa­nies have vi­o­lat­ed the Con­trolled Sub­stance Act — a pro­vi­sion nor­mal­ly re­served for drug deal­ers ac­cord­ing to ex­perts — by in­ten­tion­al­ly al­low­ing their opi­oids to flood com­mu­ni­ties, the Wall Street Jour­nal first re­port­ed. As it turned out, at least six com­pa­nies in­clud­ing J&J, Te­va, Mallinck­rodt, Am­neal and the dis­trib­u­tors McKesson and Amerisource­Ber­gen have dis­closed in re­cent SEC fil­ings that they have re­ceived grand ju­ry sub­poe­nas from the US At­tor­ney’s Of­fice for the East­ern Dis­trict of New York.

John Kapoor In­sys

No­tably, John Kapoor — the founder and for­mer chair­man of In­sys — was con­vict­ed of vi­o­lat­ing the Con­trolled Sub­stances Act but a fed­er­al judge has over­turned that part of his con­vic­tion (leav­ing charges of con­spir­a­cy, wire and mail fraud, for­fei­ture and rack­e­teer­ing in­tact).

Be­tween April and Au­gust of this year, the afore­men­tioned six com­pa­nies were asked to turn over doc­u­ments re­lat­ed to their an­ti-di­ver­sion poli­cies and pro­ce­dures and dis­tri­b­u­tion of their opi­oid med­ica­tion.

J&J and Te­va wrote that they un­der­stand the sub­poe­nas to be “part of a broad­er in­ves­ti­ga­tion in­to man­u­fac­tur­ers’ and dis­trib­u­tors’ mon­i­tor­ing pro­grams and re­port­ing un­der the Con­trolled Sub­stances Act.” The Mallinck­rodt, Am­neal and McKesson fil­ings al­so con­tained ver­sions of the state­ment, while Amerisource­Ber­gen didn’t spec­i­fy the na­ture of the probe.

Crim­i­nal charges, if they were to re­sult from the in­ves­ti­ga­tion, would mark a sig­nif­i­cant es­ca­la­tion in the le­gal tac­tics de­ployed against high-pro­file play­ers ac­cused of fu­elling the opi­oid epi­dem­ic. Ac­cord­ing to the CDC, pre­scrip­tion opi­oids led to 218,000 deaths in the US from 1999 to 2017.

Ear­li­er this year the US At­tor­ney in Man­hat­tan charged Rochester Drug Co­op­er­a­tive, the sixth-largest drug whole­saler in the US, with dis­trib­ut­ing nar­cotics that it knew “were be­ing sold and used il­lic­it­ly” and fail­ing to re­port these im­prop­er us­es to au­thor­i­ties. Two for­mer ex­ecs were al­so in­dict­ed for crim­i­nal of­fens­es.

The of­fice called the case “the first of its kind” as it es­sen­tial­ly charged a phar­ma­ceu­ti­cal dis­trib­u­tor and its ex­ecs for drug traf­fick­ing.

It’s a sig­nif­i­cant de­par­ture from the types of lit­i­ga­tion that opi­oid mak­ers such as Pur­due Phar­ma have faced, in which their ag­gres­sive sales tac­tics were blamed for caus­ing phys­i­cal and fi­nan­cial harm to the plain­tiffs. Pur­due, whose mar­ket­ing strate­gies for Oxy­Con­tin were wide­ly con­sid­ered to have plant­ed mis­con­cep­tions about the ad­dic­tive na­ture of opi­oids across the med­ical com­mu­ni­ty, has filed for bank­rupt­cy as the first step of a $10 bil­lion set­tle­ment that’s still un­der dis­pute.

John Kapoor, the high­est-rank­ing phar­ma ex­ec to be con­vict­ed in an opi­oid-re­lat­ed case so far, was most in­fa­mous for cook­ing up an elab­o­rate scheme to bribe doc­tors — go­ing so far as of­fer­ing lap dances — in­to pre­scrib­ing their pow­er­ful drug for can­cer pain, Sub­sys, to pa­tients who didn’t even have can­cer.

But a ju­ry al­so found him guilty of vi­o­lat­ing the Con­trolled Sub­stances Act. US Dis­trict Court Judge Al­li­son Bur­roughs over­turned it on Tues­day, rul­ing that pros­e­cu­tors had failed to prove that they had the in­tent to dis­trib­ute the drug for non-le­git­i­mate us­es.

Late in August, as negotiations on a pricing deal with President Trump reached a boiling point, PhRMA president Stephen Ubl sent an email update to the 34 biopharma chiefs that sit on his board. He wrote that if the industry did not agree to pay for a $100 “cash card” sent to seniors before November, White House chief of staff Mark Meadows was going to tell the news media Big Pharma was refusing to “share the savings” with the elderly. And that all of the blame for failed drug pricing negotiations would lie squarely on the industry.

Nine months after Seattle Genetics nabbed an accelerated approval for its Astellas-partnered antibody-drug conjugate Padcev, the partners said the therapy has nailed a confirmatory Phase III, proving its worth in locally advanced or metastatic urothelial cancer.

Padcev, which has widely been tapped as a potential blockbuster, scored improvements in both overall survival and progression-free survival compared to chemotherapy, causing a 30% reduction in risk of death (p = 0.001) and 39% reduction in risk of disease progression or death (p<0.00001).