Oxy kills drug maker
$8B hit spells end as Purdue misled DEA
Drug manufacturer Purdue Pharma has agreed to pay an $8 billion settlement that will result in the company being dissolved — a deal that New York Attorney General Letitia James slammed as an insult to the 470,000 Americans who have died from the opioid crisis since 2000.
The OxyContin maker will also plead guilty to three felony charges, admitting it intentionally misled the U.S. Drug Enforcement Administration and violated kickback laws by paying doctors through a speaking program, the Justice Department announced Wednesday.
The deal requires the company’s owners, the notorious Sackler family, pay $225 million to resolve civil claims. But the agreement does not free the family — once one of the richest in the country — from criminal liability.
The Justice Department hailed the deal as a major step forward in its legal fight with the prescription painkiller maker which filed for Chapter 11 bankruptcy last year.
“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 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 multipronged efforts to combat the opioids crisis,” he said.
But several state attorneys general blasted the settlement as a slap on the wrist.
“While our country continues to recover from the pain and destruction left by the Sacklers’ greed, this family has attempted to evade responsibility and lowball the millions of victims of the opioid crisis. Today’s deal doesn’t account for the hundreds of thousands of deaths or millions of addictions caused by Purdue Pharma and
the Sackler family. Instead, it allows billionaires to keep their billions without any accounting for how much they really made,” said James.
Massachusetts Attorney General Maura Healey claimed the deal was timed to give President Trump a political win two weeks before Election Day.
“DOJ failed. 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,” Healey tweeted.
Purdue board Chairman Steve Miller said in a statement that the company “deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts.”
The Sacklers said in their own statement that the family members who served on the Purdue board of directors acted “ethically and lawfully.”
No members of the Sackler family remain on the board, though they still own the company.
“This proposed resolution includes relinquishing our ownership of Purdue and has been valued at $10-$12 billion — more than double all Purdue profits the Sackler family retained since the introduction of OxyContin,” the family said.
A judge overseeing Purdue’s bankruptcy case must approve the proposal.
That means the federal government will join the many creditors seeking money from the cash-strapped company.
If the judge signs off on the deal, Purdue will no longer exist in its current form and become a “public benefit company,” owned by a trust for the benefit of the public.
“The PBC would be charged with providing its medicines in a manner as safe as possible, without diversions, while providing millions of doses of medicines to treat opioids addiction and reverse overdoses and otherwise taking into account long-term public health interests,” Rosen said.