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Report: Purdue Pharma to Plead Guilty to 3 Federal Charges

October 21, 2020

Purdue Pharma, maker of the prescription pain medication OxyContin, will plead guilty to three federal charges, including conspiracy to defraud the United States and violating anti-kickback laws, as part of an $8 billion settlement, according to an Associated Press report.

Among the terms of the plea agreement:

  • Purdue executives and owners are not released from criminal liability.
  • The company will admit that it impeded DEA by providing false information with regards to its efforts to avoid drug diversion and reporting misleading information for the purposes of boosting its manufacturing quotas.
  • Purdue will admit to using a speaking program to pay doctors as inducement for writing more prescriptions and for using EHR software to influence prescriptions of pain medications. The company will also admit to conspiring and agreeing to aid and abet the dispensing of medication from doctors “without a legitimate medical purpose and outside the usual course of professional practice,” according to a copy of the deal obtained by the AP.
  • Purdue will make a $225 million direct payment to the government, pay $2.8 billion in damages to resolve its criminal liability, and face a $3.54 billion criminal fine. The latter financial penalty is unlikely to be fully collected because it will be taken through bankruptcy proceedings which involve multiple creditors, the AP said.
  • Purdue Pharma would be transformed into a public benefit company that is governed by a trust. The Sackler family, owners of Purdue Pharma, would not be involved with the trust.

Although the deal has not been formally announced, it has already received pushback from multiple state attorneys general and Democrats in Congress, who argue that the plea agreement does not go far enough in holding Purdue Pharma executives and the Sackler family accountable. Another point of contention for opponents is that by converting Purdue to a public benefit corporation, the government would, in essence, be relying on earnings from the sale of more OxyContin to fund addiction treatment programs.

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