Report: Purdue, DOJ negotiating plea
STAMFORD — OxyContin maker Purdue Pharma this week confirmed it is in negotiations with the U.S. Justice Department amid a report that the company is close to reaching an agreement in which it would plead guilty to criminal charges and pay out billions of dollars to help resolve DO J investigations of its role in allegedly worsening the national opioid crisis.
In a statement, Purdue said it “is cooperating with the U.S. Department of Justice’s investigations of the company. We are engaged in ongoing discussions with the DO J regarding a potential resolution of these investigations.”
The company declined to comment on the specifics of the talks.
The penalties in the agreement could total more than $8 billion, including an approximately $3.5 billion criminal fine, $2 billion criminal forfeiture and $2.8 billion civil penalty, according to Reuters, which cited unnamed sources in a report this week. Alongside the criminal case, federal prosecutors are negotiating a settlement of civil claims, Reuters said.
An agreement could be announced within the next two weeks, but talks are “fluid” and terms could change as negotiations proceed, according to Reuters.
A message left for the Department of Justice was not returned.
U.S. Sen. Richard Blumenthal, D-Connnecticut, a Senate Judiciary Committee member who sued Purdue when he previously served as Connecticut’s attorney general, said in a statement Wednesday he is concerned the company would not be held suitably accountable for “egregious actions” in an agreement with the DO J.
“The millions of victims of Purdue Pharma’s pernicious and callous marketing of opioids and their families deserve a settlement that permanently ends such deadly business practices,” Blumenthal said. “The Department of Justice’s past record of leniency raises strong concerns that lawyers with personal connec
tions will tilt a possible settlement against millions of Americans that have been harmed by company’s practices.”
Other Democratic senators have said recently that the Justice Department has not prosecuted the company strongly enough.
“DO J’s history of leniency with Purdue Pharma gives us pause that the department will once again let connected lawyers obtain a settlement that does not adequately address the harms caused by the company,” Sens. Maggie Hassan and Sheldon Whitehouse, who respectively represent New Hampshire and Rhode Island, said in an Oct. 1 letter to U.S. Attorney General William Barr.
Among their requests, Hassan and Whitehouse want assurances from DO J that any settlement “does not bargain away DO J’s ability to pursue related civil or criminal claims against culpable individuals by resolving its claims against the company.”
Members of the Sackler family who own Purdue would not be criminally charged as part of the under-discussion agreement, but it would not resolve any future criminal liability that the Sacklers might face, according to Reuters.
Some family members, however, are in talks to pay an approximately $225 million civil penalty related to allegedly false claims about Purdue drugs being filed with government health care programs, Reuters said.
A message left for representatives of the Sacklers who own Purdue was not returned.
Justice Department officials had been seeking up to $18 billion from Purdue, according to reports earlier this year.
Last year, reports emerged that the talks between Purdue and the department were focusing on civil and criminal probes that have examined Purdue’s possible failure to report doctors who were illegally prescribing opioids and the firm’s order-monitoring systems.
At the same time, Purdue is still trying to negotiate in bankruptcy court a comprehensive settlement of several thousand civil complaints filed by cities and states, including Connecticut, that accuse the company of exacerbating the opioid epidemic with deceptive marketing.
Purdue and the Sacklers have denied those lawsuits’ allegations, but they have offered a settlement that they value at more than $10 billion. Two-dozen states including Connecticut have rejected that proposal, arguing that it is an insufficient plan to tackle the crisis.
Prosecutors’ scrutiny of the company goes back many years.
In 2007, a Justice Department-led investigation of Purdue produced the firm’s largest-ever punishment. In that case, it pleaded guilty in federal court to misbranding OxyContin, resulting in $635 million in company and individual penalties. But none of the three executives who pleaded guilty served any time in prison.
In October 2017, Purdue confirmed it was under investigation by the U.S. attorney’s office in Connecticut and said it was cooperating with the inquiry. A spokesman for the Connecticut USAO declined to comment Wednesday.