The U.S. Justice Department said Wednesday that Purdue Pharma, maker of the powerful opioid painkiller OxyContin, pleaded guilty to three federal criminal charges and agreed to pay more than $8 billion in fines.
OxyContin is a prescription drug that many experts said helped spark a nationwide opioid epidemic in the U.S. that is responsible for more than 470,000 overdose deaths since 2000.
As part of the settlement, Purdue Pharma admitted that it misled the federal government by falsely stating it maintained a program to avoid the transfer of controlled substances from individuals for whom they were prescribed to other people for illicit use.
Purdue Pharma also admitted it violated federal laws by paying physicians to write more prescriptions for its opioids and to use electronic health records software to influence the prescription of pain medication.
The company also admitted to violating federal law by “knowingly and intentionally” conspiring to “aid and abet” the dispensing of medication from doctors “without a legitimate medical purpose.”
The plea agreement does not protect the company’s executives or members of the Sackler family, which owns the company, from criminal liability.
When announcing the settlement in Washington, Deputy Attorney General Jeffrey Rosen said, “Just as the department prosecutes illicit drug traffickers, the department is committed to doing the same with respect to abuse and diversion of prescription opioids.”
Rosen added, “Today’s announcement focuses on the problems from wrongful activities in the prescription opioids realm, so let me note that our efforts there appear to be making a difference.”
Before the agreement was reached, there was opposition from state attorneys general, Democratic lawmakers and advocates who asked Attorney General William Barr in a letter not to negotiate with the company and the Sackler family because the proposed deal did not hold them fully accountable.
Massachusetts Attorney General Maura Healey said in a statement that the Justice Department “failed” by not “exposing the truth and holding perpetrators accountable, not rushing a settlement to beat an election.” The announcement comes less than two weeks before President Donald Trump stands for re-election on Nov. 3.
In their letter to Barr, 38 Democratic legislators said, “If the only practical consequence of your Department’s investigation is that a handful of billionaires are made slightly less rich, we fear that the American people will lose faith in the ability of the Department to provide accountability and equal justice under the law.”
The settlement requires Purdue to make a direct payment of $225 million to the federal government, which is part of a $2 billion forfeiture. The company also faces a more than $3.5 billion criminal fine, which it may not have to fully pay because it will likely be taken through a bankruptcy.
In addition to paying $2.8 billion in damages to resolve its civil liability, the U.S. company will be required to transform into a public benefit company that would be managed by a trust without the involvement of the Sackler family.
The settlement, which mirrors a part of the company’s proposal to settle about 3,000 lawsuits filed by state, local and Native American governments, also requires some of the settlement money to be spent on medically assisted treatments and other programs to combat the opioid epidemic.
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