Opioid Crisis: DOJ Nets $8.5 Billion in Fines and Penalties from Manufacturer of OxyContin

Over the last few years, state and federal law enforcement agencies have brought a number of criminal and civil actions to hold pharmaceutical companies accountable for the opioid crisis. The latest milestone in the pursuit of accountability is a DOJ settlement with Purdue Pharma, the manufacturer of OxyContin.  

Purdue Pharma began manufacturing OxyContin in the mid-1990’s and the company is viewed by the government as the originator of the aggressive and misleading marketing of opioids that drove the epidemic. According to the DOJ settlement, those marketing efforts included paying kickbacks to doctors to write prescriptions of the addictive painkiller.  Since 1999, more than 450,000 Americans have died of overdoses and other opioid-related causes and OxyContin is understood to have caused more of those deaths than any other prescription drug.  

Under the settlement, Purdue Pharma agreed to plead guilty to one count of violating of the Food, Drug, and Cosmetic Act and two counts of violating the federal Anti-Kickback Statute, and  agreed to pay $8.3 billion in fines and penalties. Because the company does not have $8.3 billion in cash, it will be dissolved, and the remaining assets will be used to form a “public benefit company.” The newly formed company’s future earnings will be used to pay Purdue Pharma’s outstanding fines and penalties. Members of Sackler family, who own Purdue Pharma, are required to pay $225 million in civil penalties under the settlement. Addressing the settlement, the members of the Sackler Family stated that they “acted ethically and lawfully” and that Purdue Pharma’s board “relied on repeated and consistent assurances from Purdue’s management team that the company was meeting all legal requirements.”

Many individual states have also filed claims against Purdue Pharma, seeking more than $2 trillion in the aggregate, and many of these states oppose the DOJ’s settlement.  After the settlement was announced, more than twenty-five state attorneys general wrote a letter expressing their opposition and arguing that the government should not participate in the sale of opioids. Several state attorneys general have also protested the lack of individual criminal charges against members of the Sackler family or Purdue Pharma executives, but the settlement does not preclude the DOJ from bringing such charges at a later date.

The attorneys at Chilivis Grubman represent both companies and individuals in connection with criminal and civil government investigations, particularly those related to allegations of healthcare fraud and abuse. If you have any questions related to such matters, please contact us today.