The State of New Jersey and the City of Newark have joined the long and growing list of states, counties, municipalities and Indian Nations that are suing pharmaceutical manufacturers and distributors as a result of the opioid epidemic. New liabilities quickly give rise to new insurance coverage issues. So far, the suit brought by the State of West Virginia has produced the country’s only opioid insurance cases. That suit essentially alleges, in eight separate statutory and common law causes of action, that “drug distributors illegally distributed controlled substances by supplying physicians and drugstores with drug quantities in excess of legitimate medical need.” Cincinnati Insurance Company v. Richie Enterprises, No.1:12-CV-00186 (W.D. KY. 2014) (“Richie 1”). The West Virginia case has now led to four insurance decisions in three states. All of the cases involve drug distributors. The cases illustrate the dispositive differences in the ways in which courts have addressed these insurance claims, and provide guidance for pharmaceutical companies seeking insurance coverage.
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