OxyContin maker to plead guilty to federal charges, pay $8 billion, close the company
By Chris Isidore, CNN Business
(CNN) -- Purdue Pharma, the maker of OxyContin, has agreed to plead guilty to three federal criminal charges for its role in creating the nation's opioid crisis and will pay more than $8 billion and close down the company.
The money will go to opioid treatment and abatement programs. The privately held company has agreed to pay a $3.5 billion fine as well as forfeit an additional $2 billion in past profits, in addition to the $2.8 billion it agreed to pay in civil liability.
The company will be dissolved as part of the criminal charges, and its assets will be used to create a new government-controlled company.
That new company will continue to produce painkillers such as OxyContin, as well as drugs to deal with opioid overdose. The money that the new company makes will now go to combat the opioid crisis.
"Purdue Pharma actively thwarted the United States' efforts to ensure compliance and prevent diversion," said Drug Enforcement Administration Assistant Administrator Tim McDermott. "The devastating ripple effect of Purdue's actions left lives lost and others addicted."
The company, which filed for bankruptcy in 2019, pleaded guilty to violating federal anti-kickback laws, as it paid doctors ostensibly to write more opioid prescriptions.
Abuse of prescription painkillers is a major cause of the nation's opioid crisis. According to the Centers for Disease Control, 450,000 people died in the United States in the 10 years starting in 1999 from overdoses involving any opioid, including prescription and illicit opioids. And about a third of those deaths in 2018 involved prescription opioids.
But while the more than $8 billion in fines and penalties in the agreement is a record to be paid by a pharmaceutical company, it is only a fraction of what it has cost federal, state and local governments to combat the opioid crisis. States across the country have filed claims topping $2 trillion in the Purdue Pharma bankruptcy case.
"Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice," said Purdue Chairman Steve Miller, who joined Purdue's board in July 2018. "Purdue today is a very different company. We have made significant changes to our leadership, operations, governance, and oversight."
The Justice Department also reached a separate $225 million civil settlement with the former owners of Purdue Pharma, the Sackler family. Still, the Sackler family -- as well as other current and former employees and owners of the the company -- face the possibility that federal criminal charges will be filed against them.
