Purdue Pharma to plead guilty, pay $8.3 bn over opioid probes

Purdue Pharma LP will plead guilty to three felonies and pay $8.3 billion to settle federal probes of how it marketed OxyContin, the addictive painkiller blamed for helping to spark the opioid epidemic.

The company’s owners, members of the billionaire Sackler family, will pay $225 million in a civil settlement with the Department of Justice, court papers and US officials said. The agreement resolves the federal government’s criminal and civil investigations, according to a filing on Wednesday in bankruptcy court in New York. Investigations by states including New York and Massachusetts will continue.

The settlement is likely to boost Purdue’s effort to move past claims it helped spark a public-health crisis over opioids with its marketing of OxyContin. Yet the company still faces thousands of civil claims by local and state officials, for which Purdue has proposed a separate $10 billion settlement. Governments are seeking reimbursement from Purdue and others for tax dollars spent coping with the crisis, which led to over 200,000 US overdose deaths and chronic addiction.

To cope with a tidal wave of claims, Purdue last year filed for Chapter 11 protection in bankruptcy court in New York. US Bankruptcy Judge Robert Drain must approve the settlement with the Department of Justice for it to become final.

“Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts,” Purdue Pharma chief executive officer Steve Miller said in a statement. “Resolving the DOJ investigations is an essential step in our bankruptcy process. The settlement agreement will pave the way for Purdue to submit a plan of reorganization to the bankruptcy court that will transfer all of its assets to a public benefit firm.”

In a bankruptcy filing earlier this year, federal prosecutors said they were seeking over $11 billion in criminal fines and civil penalties from Purdue. The government claims the company fuelled the opioid epidemic with illegal OxyContin marketing efforts.Previously in bankruptcy court, Purdue has proposed a $10 billion deal calling for Sackler family members to hand over the company to a trust controlled by the states, cities and counties that are suing it.