Amidst the ongoing opioid epidemic that has ravaged the nation, one of the U.S.’s largest drug companies and maker of OxyContin, Purdue Pharmaceuticals, pleaded guilty recently to three criminal charges and agreed to pay an $8.3M settlement to the Department of Justice (DOJ). The company is likely to pay much less due to bankruptcy claims; the Associated Press estimates that only about $225M will actually reach the federal government’s pockets.
In October 2020, the New York Times reported that despite the company’s criminal concession, the Sackler family, which owns Purdue Pharma, would not be precluded from future criminal charges as “the federal settlement does not end all of the extensive litigation against Purdue, but it does represent a significant advance in the long legal march by states, tribes, cities and counties to hold the most prominent opioid maker accountable.” This is on top of a hefty $225 million civil penalty that the Sackler family has already agreed to pay in previous court proceedings.
The DOJ pursued investigations into Perdue for the company’s involvement in pushing unnecessary amounts of oxycontin into the hands of Americans since the early 2000s. Perdue was found in violation of the False Claims Act by downplaying the drug’s severely addictive composition in it’s marketing to physicians, impeding Drug Enforcement Administration (DEA)’s from combatting the addiction crisis, and also violating anti-kickback laws. For example, last January investigators found that Perdue had paid electronic medical records company Practice Fusion to set up digital reminders and pop-up alerts to physicians as a way to drive opioid sales.
In an effort to end other ongoing lawsuits with individuals and local governments, Purdue has proposed a global settlement valued at $10B. However, critics of the proposition have stated that the amount is pitiful when compared to the Sackler’s family profits from drug sales as well as the fact that Purdue has set a restructuring plan forward to reopen as a new corporation as of March 2021. The team at Padula Law will continue to monitor the case as it progresses.
