NEWARK (LN) — Purdue Pharma LP was sentenced Tuesday in federal court in Newark and ordered to pay more than $5 billion in criminal penalties after a judge imposed punishment for the opioid manufacturer's scheme to illegally market addictive drugs to hundreds of prescribers it had good reason to believe were writing prescriptions without a legitimate medical purpose.
The sentence caps a case that began with Purdue's Nov. 24, 2020 guilty plea to a three-count felony information charging one count of a dual-object conspiracy to defraud the United States and to violate the Food, Drug, and Cosmetic Act, and two counts of conspiracy to violate the Federal Anti-Kickback Statute.
According to court documents, from 2007 to 2017, Purdue defrauded the DEA by misrepresenting the effectiveness of its diversion-prevention programs, then used prescriptions written by those problematic prescribers to justify fraudulent requests to increase its authorized manufacturing quotas. To drive still more prescriptions, the company paid kickbacks to doctors through a speaker program and to an electronic health records platform.
The court ordered Purdue to pay a criminal fine of $3.544 billion, to be assessed through its bankruptcy proceedings, plus $2 billion in criminal forfeiture. The Justice Department said it will credit up to $1.775 billion against the forfeiture amount based on the value conferred to state, local, and tribal governments through Purdue's bankruptcy, if Purdue ceases to operate in its current form and emerges from bankruptcy as a public benefit company or entity with a similar mission. The proceeds will be directed toward state and local opioid abatement programs.
Purdue is also required to host a public document repository containing records related to the criminal charges.
Acting Attorney General Todd Blanche said the company had willfully rejected the law. "Purdue Pharma put profits over patient health and safety," Blanche said. "The company willfully rejected the law and ignored the diversion of their highly addictive prescription drugs. Their actions contributed to the opioid crisis that claimed countless lives and destroyed entire families and communities. Today's sentence is a prime example of the Department's effort to redress past wrongs by rooting out and punishing unlawful conduct by companies that have contributed to the national crisis."
Assistant Attorney General A. Tysen Duva of the Justice Department's Criminal Division described the case as among the most significant the department has brought. "This generational case against Purdue Pharmaceuticals is one of the most important corporate enforcement cases ever brought by the Department of Justice," Duva said. "Purdue callously focused on profits when it knew that providers were prescribing these addictive opioids to patients without a legitimate medical purpose." Duva added that the sentencing "reflects Purdue's role in fueling the opioid crisis and concludes the Department's efforts to hold Purdue accountable for diversion of its products."
DEA Administrator Terrance Cole drew a direct line from Purdue's conduct to the current fentanyl crisis. "The prescription opioid epidemic directly paved the way for today's fentanyl crisis," Cole said.
The case was investigated by the FBI's Washington, D.C. Field Office with assistance from HHS-OIG and the DEA, and prosecuted by attorneys from the Criminal Division's Fraud Section and the U.S. Attorney's Offices for the Districts of New Jersey and Vermont.
Whether the $1.775 billion credit against the forfeiture amount is ultimately applied depends on whether Purdue successfully restructures as a public benefit company — a question that remains unresolved in its ongoing bankruptcy proceedings.