The Register Citizen (Torrington, CT)
State alleges fraud in revised opioid lawsuit
HARTFORD — Alleging the opioid-maker fraudulently transferred hundreds of millions of dollars from company accounts to the Sackler family, Connecticut Attorney General William Tong filed an expanded complaint against Stamford-based Purdue Pharma and its owners on Monday.
The amended complaint targets Purdue Pharma’s threat it may file for bankruptcy as the embattled company struggles under dozens of state and local lawsuits.
“We will not allow Purdue Pharma to cry poverty after illegally transferring hundreds of millions of dollars to members of the Sackler family — unearned funds these individuals reaped as Connecticut families suffered,” Tong said. “We are seeking a court order to claw back funds and block any further attempt to line the Sacklers’ pockets with money that should be used to correct the crisis they created.”
The complaint describes in detail how Purdue used deceptive tactics to market the drugs, fueling deadly opioid addictions. It alleges the company pushed false narratives to doctors that “susceptible individuals” — not powerful pain drugs such as OxyContin — were to blame for the addictions and some patients just needed more opioids to recover.
The complaint states the company provided savings cards to patients who could not afford the drugs to keep them on opioids
until they became addicted. The company also kept a secret “Region Zero” list of doctors, who were responsible for providing up to 10 percent of the opioids sold by the company, the allegations continue.
Purdue Pharma and the Sackler family rejected the complaints’ claims in statements.
“Purdue Pharma and the individual former directors of the company vigorously deny the allegations filed today in Connecticut and will continue to defend themselves against these misleading attacks,” Purdue Pharma said in a statement Monday. “Such allegations demand clear evidence linking the conduct alleged to the harm described, but we believe the state fails to show such causation to support its sweeping legal claims.”
Connecticut’s complaint also adds six new defendants. Five are Sackler-controlled companies: Purdue Holdings L.P., PLP Associates Holdings L.P., BR Holdings Associates L.P., Rosebay Medical Company L.P. and Beacon Company. The sixth is Russell Gasdia of Ridgefield, Purdue Pharma’s vice president of Sales and Marketing from 2010 to 2014, who joins a long list of the company’s board members and executives targeted by the state.
Gasdia, as well as some of the transfers, have never been identified by any other state lawsuit, Tong said. He called his strategy in tackling the case “follow the money.”
Filed in December 2018, Connecticut’s existing litigation against Purdue Pharma alleged four counts of the Connecticut Unfair Trade Practices Act — the new count of fraudulent transfer is a fifth hit.
The original lawsuit already named as defendants eight members of the Sackler family, who until recently served on the company’s board. New
York and Massachusetts have also targeted the family, specifically Mortimer D.A. Sackler, Kathe Sackler, Ilene Sackler Lefcourt, Theresa Sackler, Jonathan Sackler, David Sackler, Beverly Sackler and Richard Sackler.
Richard Sackler has won particular media attention for his emails, revealed in court documents, that showed his investment in pushing high doses of the drugs, ignoring concerns that would hamper his sales ambitions. Tong singled Richard out for his “callous indifference” with which he pursued profits on Monday.
“Dr. Richard Sackler is sorry for using insensitive language in an email with friends nearly 20 years ago during moments of frustration about reports of illicit activity involving prescription opioids, as those comments do not reflect how he truly feels or ever actually acted,” said the Sackler family members named in the complaint in a statement. “Headline-seeking lawsuits that mischaracterize emails do not change the facts, nor do they save lives in Connecticut, whose people are looking to their leaders for results, not a repackaged lawsuit.”
Connecticut is one of more than 30 states to sue Purdue Pharma. At the same time, Connecticut, Massachusetts and New York are also members of a joint investigation by more than 40 states that focuses on Purdue and several other pharmaceutical firms.
“Purdue Pharma maintains its corporate offices in Stamford, Connecticut. Many of the defendants make their home or did make their home in Connecticut,” said Tong. “That means that Connecticut has a special responsibility to be aggressive and hold wrongdoers accountable to the fullest extent of the law and that’s what we are going to do.”
The state is “full-bore” preparing for a trial against Purdue Pharma and the Sacklers, Tong said.
Purdue Pharma maintained that the company has acted to fight opioid addictions with government and law
enforcement agencies for over a decade. It denied that Oxycontin and opioid medications are unsafe when used as prescribed because they are approved by the U.S. Food and Drug Administration. Sackler family members blamed “illicit fentanyl and heroin smuggled in from China and Mexico” for the opioid crisis.
Both the company and the family promised to defend themselves and fight for solutions to addiction.
Connecticut’s litigation was kicked off by former Attorney General George Jepsen, but Tong has made the lawsuit a top priority. Tong hinted the expanded complaint was coming in an announcement last week.
More than 1,000 municipal, county and state lawsuits have been filed against Purdue in the past few years. Most of the local governments’ complaints have been consolidated in a “multidistrict litigation” process in a federal court in Cleveland. The first MDL trial is scheduled to start in October.
In its largest payout of the past 10 years, Purdue agreed last month to a $270 million settlement of Oklahoma’s lawsuit. About $200 million — including $75 million donated by the Sacklers — will help establish the National Center for Addiction Studies and Treatment at Oklahoma State University’s campus in Tulsa.
As it grapples with the legal pressure, Purdue has undergone sweeping changes in the past year and a half. In 2019, the last of the Sacklers named in the lawsuits left the company’s board. In 2018, the company laid off several hundred employees after it stopped controversial opioid marketing to medical professionals and then disbanded its sales force.