RESEARCH ANALYSIS | The Illicit Opioid Market: Patterns and Implications

The Illicit Opioid Market: Patterns and Implications

Justin Leggin, BS

Sidney Kimmel Medical College at Thomas Jefferson University

SUMMARY POINTS

• The 2010 reformulation of OxyContin led to a rapid and documented substitution effect, igniting a heroin epidemic that quadrupled heroin deaths in just four years.

• Synthetic opioids, primarily illicit fentanyl, have since reshaped the overdose crisis, with fentanyl-related deaths increasing over 1,000% from 2013 to 2019.

• Supply-side interventions such as the OxyContin reformulation and restrictions on fentanyl analogs or xylazine have repeatedly triggered the rise of substitutes in the illicit drug supply, like heroin, carfentanil, and medetomidine.

• The current emergence of medetomidine in 2024–2025 illustrates an ongoing "whack-a-mole" effect, where removing one dangerous adulterant rapidly leads to substitution with another, often more potent one.

• Without strategies that address demand—such as treatment access, harm reduction, and education—supply-only policies risk merely reshaping the crisis, not resolving it.

ANALYSIS

Background

In the late 1990s and early 2000s, OxyContin became emblematic of a new wave of pain management. Marketed as a safe and effective long-acting painkiller, it was aggressively promoted by Purdue Pharma and widely prescribed for both acute and chronic pain. However, its original formulation could be easily crushed or dissolved to deliver a rapid and powerful euphoric high. By the mid-2000s, OxyContin misuse had become rampant, contributing to a quadrupling of overdose deaths from prescription opioids between 1999 and 2010 (1).

Findings

In response, Purdue reformulated OxyContin in August 2010 to make it tamper-resistant. The new abuse-deterrent formulation (ADF) was designed to be difficult to crush, break, or dissolve, thereby deterring misuse through snorting or injection. While OxyContin misuse fell almost immediately, the reformulation produced a dangerous ripple effect. Individuals physically dependent on high-dose opioids quickly sought substitutes. Heroin, cheaper and widely available, became the default alternative.

The resulting substitution was rapid and devastating. Following the ADF reformulation in August 2010, heroin overdose deaths began to rise as early as September 2010 and would quadruple between 2010 and 2014 (2). A structural break analysis by Evans et al. identified August–September 2010 as the inflection point when heroin indicators—overdose deaths, treatment admissions, and arrests—spiked nationally. The increase in heroin mortality was not uniform across the country; it was steepest in areas that had the greatest OxyContin abuse before 2010 and ready access to heroin markets (Figure 1) (2). For example, states above the median in OxyContin misuse and with established heroin presence saw the largest post-2010 surge in heroin deaths. In contrast, states with low pre-reformulation OxyContin misuse (or limited heroin availability) showed smaller increases. Importantly, before 2010, those high-misuse and low-misuse states had very similar heroin death trends – the divergence only began after the OxyContin supply shock (2).

Figure 1. Monthly heroin death rate from January 2004–December 2014, by state OxyContin misuse and heroin presence.

Although the reformulation did reduce OxyContin-specific deaths, this gain was offset almost exactly by a rise in heroin-related fatalities. One study concluded that “each prevented opioid death was replaced with a heroin death,” revealing a roughly one-for-one substitution effect (2). This case illustrates a foundational principle of drug policy: if substitutes exist and demand persists, supply-side interventions may only displace harm rather than eliminate it.

By 2013, the next wave of the opioid crisis had begun. Fentanyl, a synthetic opioid 50–100 times more potent than heroin, emerged in the illicit drug supply. Initially manufactured in clandestine labs and often pressed into counterfeit pills or mixed with heroin, fentanyl quickly became a dominant force. Its low cost, ease of transport, and extreme potency made it highly attractive to traffickers.

The market had dramatically shifted: whereas the early epidemic was iatrogenic and prescription-driven, the new wave of the opioid epidemic was fueled by an illicit, unregulated supply chain optimized for potency and profit. Between 2013 and 2019, synthetic opioid-involved deaths rose by an astonishing 1,040% (3). However, in 2018, opioid overdose deaths fell 4.1%, the first such drop in decades. Some policymakers attributed this to public health interventions, but deeper analysis suggested otherwise. A study published in Addiction found this downturn was statistically associated with the sudden appearance and then retreat of carfentanil, an ultra-potent fentanyl analog used as an elephant tranquilizer, in the drug supply. Carfentanil availability had surged in 2016–2017 and was associated with numerous overdose outbreaks; it then plummeted in 2018 following China’s ban on fentanyl analog exports and the DEA’s class-wide scheduling of fentanyl-like substances (4). During this same period, the five states with the highest carfentanil presence—Ohio, Florida, Pennsylvania, Kentucky, and Michigan—also experienced the largest overdose death increases in 2017 (+13.7%) and the steepest declines in 2018 (−14.3%, FIGURE 2). Overall overdose deaths fell in tandem but resumed their exponential trajectory in 2019.

Figure 2. Trends of overdose deaths in states with high carfentanil exhibits compared to all the other states.

This episode reveals how fluctuations in the potency and composition of the drug supply—not just policy or behavioral change—can significantly shape overdose trends. The volatility of synthetic drug markets undermines any strategy focused solely on one substance or analog.

Beginning in 2015, xylazine—a centrally acting alpha-2 agonist used as a veterinary tranquilizer—began appearing in the illicit opioid supply, especially in the Northeast. Known colloquially as “tranq,” xylazine was not only unregulated but also enhanced the duration of fentanyl’s short-lived high from 30–60 minutes to 8–72 hours. It was quickly adopted as a widespread adulterant. By November 2022, xylazine was present in 48 of 50 states and linked to 11% of all fentanyl overdoses—a 279% increase from 2019 (5). In 2023, xylazine was present in up to 100% of fentanyl samples in Philadelphia, Pennsylvania (5, 6, 7).

Despite its extended high, xylazine use came with severe complications. Unlike opioids, xylazine is not reversed by naloxone. It causes extended sedation, tissue necrosis, and profound withdrawal symptoms. Between 2020 and 2024, Philadelphia saw a 307% increase in emergency department (ED) visits for substance-related skin and soft tissue injuries (SSTIs) (8).

As concern grew, regulatory efforts followed. In mid-2023, Pennsylvania classified xylazine as a controlled substance, and by early 2024, its prevalence in the local drug supply began to drop. But history repeated itself. By May 2024, medetomidine began to appear. Though similar to xylazine in its sedative role in veterinary medicine, medetomidine is 100–200 times more potent than its predecessor (8). Within just a few months, it was increasingly detected in Philadelphia fentanyl samples, while xylazine presence plummeted (Figure 3) (9).

Figure 3. Prevalence of xylazine and medetomidine in fentanyl samples in Philadelphia, PA.

The consequences of this “swap” proved to be severe. Between September 2024 and January 2025, a newly recognized withdrawal syndrome emerged among users exposed to fentanyl-medetomidine combinations. In a May 2025 CDC investigation, 165 patients presented with withdrawal symptoms unresponsive to standard opioid and sedative protocols. Ninety-one percent required ICU-level care, and 24% were intubated. Ultimately, 83% of patients improved after receiving infusions of dexmedetomidine, a hospital-administered alpha-2 agonist not designed for outpatient addiction care (8).

Similarly, in a Philadelphia Department of Public Health (PDPH) Community Health and Research Trends (CHART) investigation of EDs across multiple health systems in Philadelphia, PA, ED visits for substance use-related SSTIs peaked in Q1 2024 but fell by 49% by Q1 2025⁸. In contrast, ED visits for withdrawal (excluding visits where only alcohol, nicotine, or marijuana withdrawal were documented) increased 134% over the same period (FIGURE 4). These shifts coincided with the emergence of medetomidine following the 2023 scheduling of xylazine, suggesting a substitution effect in response to xylazine restrictions.

Figure 4. From Q1 2020 to Q1 2025 (A) Philadelphia ED visits for substance use-related SSTIs and (B) Philadelphia ED visits for withdrawal.

This clinical crisis exposed the fragility of existing treatment protocols in the face of an evolving and increasingly unpredictable street drug supply.

Discussion

Despite dramatic reductions in opioid prescribing—down 20% between 2012 and 2023—opioid overdose deaths have continued to rise (10). Prescription opioids accounted for only 16% of opioid-related deaths in 2023, a stark contrast to their central role in the first wave of the opioid epidemic from the late 1990s to 2010 (11). The primary drivers of mortality today are illicit fentanyl and its adulterants.

This history—OxyContin to heroin, fentanyl to carfentanil, xylazine to medetomidine—reveals a repeating pattern: well-intentioned supply-side policies often produce unintended consequences when substitutes are readily available. The illicit market is adapting quickly. When one substance is banned, regulated, or made scarce, another fills its place—often with equal or greater lethality.

Future drug policy must account for these dynamics. Reducing supply without addressing demand through expanded treatment, harm reduction infrastructure, and overdose prevention may simply reshape the crisis rather than resolve it. As the Philadelphia medetomidine outbreak demonstrates, the consequences of substitution are not theoretical; they are immediate, measurable, and deadly.

REFERENCES

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2.     Evans WN, Lieber E, Power P. How the Reformulation of Oxycontin Ignited the Heroin Epidemic. National Bureau of Economic Research. 2018. Accessed June 29, 2025. https://www.nber.org/system/files/working_papers/w24475/w24475.pdf

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8.     Puleo M, Ward N, Higgins D. Changes in Philadelphia’s Drug Supply and Substance Use-Related Emergency Department Visits. 2025.

9.     Huo S. Notes from the Field: Suspected Medetomidine Withdrawal Syndrome Among Fentanyl-Exposed Patients — Philadelphia, September 2024–January 2025. MMWR Morb Mortal Wkly Rep. 2025;74. doi:10.15585/mmwr.mm7415a2

10.  CDC. Opioid Dispensing Rate Maps. Overdose Prevention. November 7, 2024. Accessed June 29, 2025. https://www.cdc.gov/overdose-prevention/data-research/facts-stats/opioid-dispensing-rate-maps.html

11.  NIDA. Drug Overdose Deaths: Facts and Figures. National Institute on Drug Abuse. August 21, 2024. Accessed June 29, 2025. https://nida.nih.gov/research-topics/trends-statistics/overdose-death-rates