OxyContin maker Purdue Pharma to plead to 3 criminal charges

WASHINGTON – Drugmaker Purdue Pharma, the company behind the powerful prescription painkiller OxyContin that experts say helped touch off an opioid epidemic, will plead guilty to federal criminal charges as part of a settlement of more than $8 billion, the Justice Department announced Wednesday.

The deal does not release any of the company’s executives or owners – members of the wealthy Sackler family – from criminal liability, and a criminal investigation is ongoing. Family members said they acted “ethically and lawfully,” but some state attorneys general said the agreement fails to hold the Sacklers accountable.

The company will plead guilty to three counts, including conspiracy to defraud the United States and violating federal anti-kickback laws, the officials said, and the agreement will be detailed in a bankruptcy court filing in federal court.

The Sacklers will lose all control over their company, a move already in the works, and Purdue will become a public benefit company, meaning it will be governed by a trust that has to balance the trust’s interests against those of the American public and public health, officials said.

The settlement is the highest-profile display yet of the federal government seeking to hold a major drugmaker responsible for an opioid addiction and overdose crisis linked to more than 470,000 deaths in the country since 2000.

It comes less than two weeks before a presidential election where the opioid epidemic has taken a political back seat to the coronavirus pandemic and other issues, and gives President Donald Trump’s administration an example of action on the addiction crisis, which he promised early on in his term.

Democratic attorneys general criticized the agreement as a “mere mirage” of justice for victims.

“The federal government had the power here to put the Sacklers in jail, and they didn’t,” Connecticut Attorney General William Tong said in a statement. “Instead, they took fines and penalties that Purdue likely will never fully pay.”

But members of the Sackler family, once listed as one of the nation’s wealthiest by Forbes magazine, said they had acted “ethically and lawfully” and that company documents required under the settlement to be made public will show that.

“Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts,” Steve Miller, who became chairman of the company’s board in 2018, said in a statement. No members of the Sackler family remain on that board, though they still own the company.

Family members, in a statement, expressed “deep compassion for people who suffer from opioid addiction and abuse and hope the proposal will be implemented as swiftly as possible to help address their critical needs.”

As part of the resolution, Purdue is admitting that it impeded the Drug Enforcement Administration by falsely representing that it had maintained an effective program to avoid drug diversion and by reporting misleading information to the agency to boost the company’s manufacturing quotas, the officials said.

Purdue is also admitting to violating federal anti-kickback laws by paying doctors, through a speaking program, to induce them to write more prescriptions for the company’s opioids and for using electronic health records software to influence the prescription of pain medication, according to the officials.

Purdue will make a direct payment to the government of $225 million, which is part of a larger $2 billion criminal forfeiture. In addition to that forfeiture, Purdue also faces a $3.54 billion criminal fine, though that money probably will not be fully collected because it will be taken through a bankruptcy, which includes a large number of other creditors, including thousands of state and local governments. Purdue will also agree to $2.8 billion in damages to resolve its civil liability.

Part of the money from the settlement would go to aid in medication-assisted treatment and other drug programs to combat the opioid epidemic. That part of the arrangement echoes the plan the company is pushing in bankruptcy court and which about half the states oppose.