US federal prosecutors have won another victory against the pharmaceutical industry this week in an ongoing legal battle over the opioid crisis.
Purdue Pharma, maker of the popular OxyContin painkiller, will plead guilty to federal criminal charges for using deceptive practices to market its medication to doctors and patients. In a settlement of more than $8 billion, the company has agreed to plead guilty to three counts, including conspiracy to defraud the US and violating federal anti-kickback laws that prohibit drug companies from paying doctors to prescribe their medicine.
Purdue has admitted to impeding the US Drug Enforcement Agency by reporting misleading information and lying about having an effective program to stop its pills from being sold illegally. The company will pay $225 million directly to the US government as part of a $2 billion criminal forfeiture and another $2.8 billion to resolve numerous civil lawsuits. The company has also been fined $3.54 billion for criminal activity, but will likely be able to skip out on this fine because it has already filed for bankruptcy.
As part of the settlement, Purdue will be dissolved entirely and turned into a public benefit company that's governed by a trust. The corporation's owners, the Sackler family, will cede all control over the company to the federal government. This family, which rose to become one of the wealthiest families in the US after raking in $13 billion in opioid sales, will also personally pay at least another $3 billion to defend themselves against civil suits. The current settlement does not protect the family from further litigation.
As extensive as the $8 billion-plus settlement is, state prosecutors want to go even further. Prosecutors and Congressmembers urged the US Department of Justice not to accept this plea deal, arguing that it is only a slap on the wrist for a corporation of this size. Lawmakers have also criticized the government's decision to take ownership of the company, as the feds will now be directly making profit from selling these addictive pharmaceuticals.
“Millions of American families impacted by the opioid epidemic are looking to you and your Department for justice,” wrote 38 Democratic Congressmembers, the Associated Press reports. “Justice for the sleepless nights spent worrying about sons and daughters trapped in the grip of substance use disorder, justice for the jobs lost and the lives ruined, and justice for the lives of loved ones lost to overdoses.”
“If the only practical consequence of your Department’s investigation is that a handful of billionaires are made slightly less rich, we fear that the American people will lose faith in the ability of the Department to provide accountability and equal justice under the law,” the letter concluded.
The Purdue settlement is part of a larger legal battle between federal and state prosecutors and Big Pharma over the opioid crisis. Since 2000, nearly half a million Americans have died as a result of opioid addiction and overdoses. Over the past 3 years, state and federal prosecutors have joined civil lawsuits accusing pharmaceutical companies of illegally promoting their drugs and allowing them to be easily diverted to the black market.
Last year, an Oklahoma judge fined Johnson & Johnson $572 million for its role in the crisis, and Purdue and Teva Pharmaceutical both agreed to settle for millions in damages. Thousands of other lawsuits have been merged into one massive years-long legal battle that has yet to play out. Earlier this year, the pharmaceutical industry offered $18 billion to settle the case, but prosecutors are now pushing for a $48 billion settlement.