The U.S. Department of Justice today announced a roughly $8 billion resolution with Purdue Pharma relating to its role in the U.S. opioid abuse crisis.
The agreement — which is pending approval in bankruptcy court in Southern New York as part of Purdue’s ongoing Chapter 11 process — has the company paying a criminal fine of $3.544 billion and an additional $2 billion in criminal forfeiture. Purdue will also pay a civil settlement in the amount of $2.8 billion to resolve its liability under the False Claims Act, and its founding Sackler family will pay $225 million in damages.
The amounts that the company ends up eventually paying be less. For the $2 billion forfeiture, the company will pay $225 million on the effective date of the bankruptcy, but the federal government may credit the rest to support the new public benefit company (PBC) that is expected to emerge from the bankruptcy. The PBC is expected to pay more than $10 billion as part of a separate settlement reached last year with multiple U.S. states and territories.
“Resolving the DOJ investigations is an essential step in our bankruptcy process,” Purdue’s board chair Steve Miller said in a news release. “The settlement agreement will pave the way for Purdue to submit a plan of reorganization to the bankruptcy court that will transfer all of Purdue’s assets to a public benefit company, and ultimately deliver more than $10 billion in value to claimants and communities.”
The criminal settlement included Purdue admitting that it misled the Drug Enforcement Administration for at least a decade – from 2007 to 2017 — as it sold its opioid products, including OxyContin, to health providers that Purdue officials had good reason to believe were facilitating drug abuse.
“Purdue Pharma actively thwarted the United States’ efforts to ensure compliance and prevent diversion. The devastating ripple effect of Purdue’s actions left lives lost and others addicted. DEA will continue to work tirelessly with our partners and the pharmaceutical industry to address the damage that has been done, and bring an end to this epidemic that has gripped the nation for far too long,” said DEA Administrator Tim McDermott.
Miller at Purdue said the company “deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts.”
Filed Under: Drug Discovery
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