Department of Justice Announces an $8 Billion Settlement with Purdue Pharma

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  • Source: UncoverDC
  • 09/19/2023

America's war on drugs became a little more muscular with the Department of Justice (DOJ) announcement today. In October of 2017, President Trump declared the opioid crisis a public health emergency. An October 2018 White House follow up press release updated Americans on his "commitment to stopping the crisis in its tracks."

Douglas Healey/AP

Today Deputy Attorney General Jeffrey A. Rosen underscored the commitment by announcing an $8 billion settlement and a guilty plea to three counts with OxyContin manufacturer, Purdue Pharma.

In prepared remarks released by the DOJ, Rosen began with highlighting "the Department of Justice’s wider efforts to address the opioids crisis. Department of Justice obviously has many longstanding and ongoing drug enforcement activities. But during this administration, we have augmented those with a series of new initiatives targeted at both illicit opioids like heroin and fentanyl, and at the diversion and abuse of prescription opioids as well." He explained that the approach has been to address every level of the supply chain with regard to illicit drugs and "[on] the prescription side, that means any unlawful actions by manufacturers, distributors, pharmacy dispensers, or physician prescribers, for example."

The plea agreement, subject to bankruptcy court approval "involves the company pleading guilty to three felony counts for defrauding the United States and violating the Anti-Kickback Statute from 2009 to 2017. In addition to agreeing to plead guilty to these three felony counts, the company has agreed to a $3.544 billion criminal fine and a $2 billion criminal forfeiture amount. Further, to resolve its civil liability, Purdue Pharma has agreed to $2.8 billion in damages to the United States. The company is in bankruptcy, so the corporate resolution is subject to the bankruptcy court’s approval. If approved, this will be a corporate settlement totaling more than $8.3 billion. Additionally, members of the Sackler family have agreed to pay $225 million in a civil settlement that will provide civil releases only."

The Sacklers will release all stakes in the company. Purdue Pharma will "no longer exist in its present form, the Sacklers must relinquish all ownership and control of the company (and its successors), and the assets must be transferred to a new public benefit company or PBC owned by a trust for the benefit the American public." The new PBC will be charged with safely distributing drugs and, more importantly, will focus on treating opioid addiction.

Those who have paid attention know that the Trump administration has been passionate about drug addiction in this country- with a focus on opioids. President Trump has often spoken about his personal connection to addiction because of his brother's struggle with alcoholism. In an op-ed originally appearing in USA Today in September of 2018, Alex Azar, the Secretary of the U.S. Department of Health and Human Services updated the American public on the scale of the opioid epidemic. He cited statistics that underscored just why the Trump administration is so committed to combatting the opioid crisis. At the time, the Center for Disease Control (DC) statistics for 2017 showed that more than 72,000 Americans died of a drug overdose in that year alone- "most involving opioids."

AP Photo

The CDC now reports that "since 2017, prescription opioid overdose deaths have decreased--by over 18 percent in the first two years.  And there has been a 47 percent decline in prescription opioids being dispensed."

The lawsuit states that Purdue is pleading guilty to three counts, including conspiracy to defraud the United States and violating federal anti-kickback laws.

Rosen explained that Purdue is not the first to come under scrutiny or prosecution. The DOJ has aggressively pursued individual practitioners as well as "opioid distributors like McKesson, Miami-Luken, and Rochester Drug Cooperative. We reached substantial settlement resolutions with other manufacturers, such as RB Group and Indivior, as well as Insys." According to APNews, this settlement portends to be 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."


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