$8 billion OxyContin deal comes in for criticism

The pharmaceutical firm that created one of the drugs behind the US opioid epidemic has agreed an $8 billion plus deal with the US Department of Justice (DoJ) and pleaded guilty to three criminal charges.

Purdue Pharma L.P. (Purdue) announced that it has entered into an agreement with the DOJ to resolve multi-year civil and criminal investigations into the company’s past marketing practices related to its opioid medicines. Under the terms of the agreement Purdue Pharma will admit to enabling the supply of drugs “without legitimate medical purpose”.

However while the deal will now need to be signed off by the judge which is handling the company’s bankruptcy filing it has also been heavily criticised by a number of states and families which are also suing the firm over its production and distribution of OxyContin.

“With the agreement, Purdue accepts responsibility for specified misconduct that took place before June 2017 and resolves allegations regarding conduct between 2007 and February 2018 by pleading guilty and agreeing to pay fines and forfeiture,” it said in a statement. “Importantly, the overwhelming majority of these settlement funds will be directed to state, local and tribal governments to address the opioid crisis.”

As part of the plea, Purdue will admit that from May 2007 through at least March 2017, Purdue conspired to defraud the United States by impeding the lawful function of the DEA by representing to the DEA that Purdue maintained an effective anti-diversion program when, in fact, Purdue continued to market its opioid products to more than 100 health care providers whom the company had good reason to believe were diverting opioids and by reporting misleading information to the DEA to boost Purdue’s manufacturing quotas.

“Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts,” said Steve Miller, who joined Purdue’s Board as Chairman in July 2018. “Resolving the DOJ investigations is an essential step in our bankruptcy process.

“The settlement agreement will pave the way for Purdue to submit a plan of reorganization to the bankruptcy court that will transfer all of Purdue’s assets to a public benefit company, and ultimately deliver more than $10 billion in value to claimants and communities.”

“The abuse and diversion of prescription opioids has contributed to a national tragedy of addiction and deaths, in addition to those caused by illicit street opioids,” said Deputy Attorney General Jeffrey A. Rosen.  “With criminal guilty pleas, a federal settlement of more than $8 billion, and the dissolution of a company and repurposing its assets entirely for the public’s benefit, the resolution in today’s announcement re-affirms that the Department of Justice will not relent in its multi-pronged efforts to combat the opioids crisis.”

The firm is owned by the Sackler Family, multi-billionaires who have become  vilified by many due to the company’s role in the Opioid crisis which has killed nearly 500,000 Americans in the past three decades since Purdue created  OxyContin, a slow release painkiller.

It filed for bankruptcy  in 2018 to seek to avoid the deluge of legal cases being brought against it.

“Today’s agreement with DOJ resolves all potential criminal charges against the company with respect to the production, sale, marketing and distribution of its opioid products through the present,” said the firm’s statement. The civil settlement was entered into to avoid the delay, uncertainty, and expense of protracted litigation.

“The settlement agreement with DOJ is being submitted to the bankruptcy court for review and approval. Under the terms of the agreement, Purdue’s $225 million payment is deferred until the entry of the judgment of conviction, which is expected to take place after the bankruptcy court approves a plan of reorganisation.”

However the news has not been welcomed by many.

“DoJ failed,” said Massachusetts attorney general Maura Healey on social media after the news of the settlement was revealed. “Justice in this case requires exposing the truth and holding the perpetrators accountable, not rushing a settlement to beat an election. I am not done with Purdue and the Sacklers, and I will never sell out the families who have been calling for justice for so long.”

“This resolution is the result of years of hard work by the FBI and its partners to combat the opioid crisis in the U.S.,” said Steven M. D’Antuono, Assistant Director in Charge of the FBI Washington Field Office.  “Purdue, through greed and violation of the law, prioritized money over the health and well-being of patients.  The FBI remains committed to holding companies accountable for their illegal and inexcusable activity and to seeking justice, on behalf of the victims, for those who contributed to the opioid crisis.”

“The opioid epidemic remains a significant public health challenge that impacts the lives of men and women across the country,” said Gary L. Cantrell Deputy Inspector General for Investigations at the U.S. Department of Health and Human Services’ Office of Inspector General.  “Unfortunately, Purdue’s reckless actions and violation of the law senselessly risked patients’ health and well-being.  With our law enforcement partners, we will continue to combat the opioid crisis, including holding the pharmaceutical industry and its executives accountable.”

“This resolution closes a particularly sad chapter in the ongoing battle against opioid addiction,” said Drug Enforcement Administration (DEA) Assistant Administrator Tim McDermott.  “Purdue Pharma actively thwarted the United States’ efforts to ensure compliance and prevent diversion.  The devastating ripple effect of Purdue’s actions left lives lost and others addicted.  DEA will continue to work tirelessly with our partners and the pharmaceutical industry to address the damage that has been done and bring an end to this epidemic that has gripped the nation for far too long.”

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