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‘The DOJ Sold Victims Out’: Experts Criticize Purdue Pharma Settlement as State AGs Promise More Action

The Purdue Pharma headquarters in downtown Stamford, Conn.

The U.S. Department of Justice (DOJ) announced Wednesday that Purdue Pharmaceutical agreed to plead guilty to three federal crimes as part of a settlement in excess of $8 billion. Critics, however, say the company and family behind it is getting off light.

According to the Associated Press, the widely reviled drug company will plead guilty to conspiracy, violating federal anti-kickback laws and to falsely representing itself before the Drug Enforcement Agency (DEA) as part of the three-count plea agreement.

Purdue will admit that it “knowingly and intentionally conspired and agreed with others to aid and abet” the promotion of medicine from doctors “without a legitimate medical purpose and outside the usual course of professional practice,” the outlet reports.

Notably, the price tag for the settlement is substantially smaller than the $11 billion settlement proposed by the DOJ earlier this summer.

“A majority of state attorneys general, leading members of Congress, [abd] activist groups think [the settlement] is a bad idea,” noted pharmaceutical industry author Gerald Posner via Twitter. “This might be the second time in 13 years that the DOJ sold victims out.”

The author expanded on his argument in a blog post:

Will any pending settlement involve guilty pleas to criminal charges that are resolved by fines only and without any jail time? As in 2006, a decision by the DOJ to remove any threat of jail for Purdue and its executives would be a capitulation to wrap up a politically expedient settlement before the election.

Many important issues undoubtedly get clouded by political considerations in a presidential election year. However, the many opioid victims and their families to whom I have spoken, would consider it an unforgiveable betrayal. It is a major miscalculation for the administration to believe that those Americans who have personally paid the price for the opioid epidemic want to see the architects of the crisis get a “get out of jail free” card.

Others criticized the deal along those lines as well.

The charges will be detailed in a filing reportedly forthcoming with a U.S. bankruptcy court. Purdue filed for Chapter 11 bankruptcy in September 2019 in an effort to avoid legal liability over its role in the two-decade-plus-long opioid epidemic that has taken the lives of nearly half a million Americans since 1999.

Several state, federal, and class action lawsuits–in excess of 2,600–were filed against Purdue, a company wholly owned by the family of the late Raymond Sackler, filed for bankruptcy protections. The founder of the company that developed OxyContin is survived by his children Richard Sackler, Jonathan D. Sackler, and Richard S. Sackler.

Victims, advocates, attorneys general and other politicians have long expressed caution and concern over the possibility of achieving justice by way of bankruptcy proceedings. When a company enters Chapter 11 bankruptcy, all civil lawsuits are automatically stayed and the plaintiffs are forced to stand in line as would-be creditors. The Sackler family, typical of the American justice system’s preference for–and kid gloves approach to–billionaires, was also personally and controversially granted a stay of civil litigation.

“The move to bury what should be a mass public reckoning in the opaque crevices of bankruptcy court typifies underhanded Sackler marketing practices,” noted Natasha Lennard earlier this year. “In response, those fighting for accountability have been forced to navigate a complex legal terrain in efforts to access even a shred of justice.”

The plea deal, however, does not touch upon whether or not the Sackler family–or Purdue’s top level executives–will be criminally charged in their individual names. Such investigations are ongoing. The agreement is only a civil and criminal dispensation of various claims against the company under its corporate form–which will effectively cease to exist as currently constituted.

Under the terms of the plea agreement, Purdue must transition into a public benefit corporation that will be governed by a trust. Public benefit corporations are profit-driven but, per the terms of their operating agreements, must also make benefiting the public part of their charter. Purdue is reportedly said to be focused on moving towards a public health company. Additionally, the Sackler family will not be allowed to take part in the new corporate entity.

[image via Drew Angerer/Getty Images]

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