STAMFORD, Conn. – Purdue Pharma announced Wednesday that it has entered into an $8.3 billion agreement with the United States Department of Justice (DOJ) to resolve multi-year civil and criminal investigations into the company’s past marketing practices related to its opioid medicines.
With the agreement, Purdue accepts responsibility for specified misconduct that took place before June 2017 and resolves allegations regarding conduct between 2007 and February 2018 by pleading guilty and agreeing to pay fines and forfeiture. Importantly, the overwhelming majority of these settlement funds will be directed to state, local and tribal governments to address the opioid crisis.
“Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts,” said Steve Miller, who joined Purdue’s board as chairman in July 2018.
“Resolving the DOJ investigations is an essential step in our bankruptcy process,” said Miller. “The settlement agreement will pave the way for Purdue to submit a plan of reorganization to the bankruptcy court that will transfer all of Purdue’s assets to a public benefit company, and ultimately deliver more than $10 billion in value to claimants and communities.”
The new company will be operated under different ownership, will be overseen by new trustees for the benefit of claimants and the American people, and will work to provide for free or at cost millions of doses of lifesaving opioid addiction treatment and overdose reversal medicines.
“Purdue today is a very different company,” said Miller. “We have made significant changes to our leadership, operations, governance, and oversight.”
In the last few years, Purdue has made the following changes:
- Ending all promotion of opioids and opioid products to healthcare professionals (HCPs) and eliminating its sales force.
- Appointing a new President and CEO.
- Adding a new independent Chairman of the Board and other highly qualified directors with restructuring and pharmaceutical industry experience.
- Accepting the resignations of all Sackler family members from the Board.
- Agreeing to be bound by – and continuing to comply fully with – an unprecedented voluntary injunction that further restricts the Company’s promotion of its opioid medications.
- Agreeing to have an independent monitor review the Company’s compliance with the voluntary injunction.
Today’s agreement with DOJ resolves all potential criminal charges against the company with respect to the production, sale, marketing and distribution of its opioid products through the present. The civil settlement was entered into to avoid the delay, uncertainty, and expense of protracted litigation.
The settlement agreement with DOJ is being submitted to the bankruptcy court for review and approval. Under the terms of the agreement, Purdue’s $225 million payment is deferred until the entry of the judgment of conviction, which is expected to take place after the bankruptcy court approves a plan of reorganization.
Documents related to Purdue’s bankruptcy can be accessed here: https://restructuring.primeclerk.com/purduepharma/Home-DocketInfo