Opioid settlements and the war on drugs have been trending in America for quite some time now. Purdue Pharma, the creator of the opioid OxyContin in 1996, has especially been in the spotlight over the years due to the marketing strategy it deployed for the drug.
Many people place significant weight on the pharmaceutical company for the cause of the US opioid crisis. Though previously ordered to file for bankruptcy in September of 2019 as part of the ongoing settlement agreement, on October 21, 2020, the Justice Department delivered a controversial announcement regarding the ongoing opioid settlements that have come about after the US opioid crisis has taken the lives of nearly a quarter-million Americans, and has globally affected the lives of trillions.Read More »
Since marketing the painkiller, thousands of lawsuits have been made towards them, some even claiming that the firm played a significant role in fueling the US opioid crisis and illegal drug economy. The vast majority of the lawsuits filed against the pharmaceutical company were on the basis of its misleading marketing.
Keep in mind that the investigation regarding Purdue’s marketing practices is still ongoing and criminal charges are still a possibility for the company’s founders and executives.
Previously, the Pharmaceutical giant was ordered to file for bankruptcy in September of 2019 as part of the ongoing settlement agreement.
Just last week, over 30 Democratic members of Congress sent letters to Attorney General William Barr insisting that prison time be mandated for the owners and executives at Purdue Pharma.
Breakdown of the Settlement
Deputy Attorney General Jeffrey Rosen delivered the announcement of the settlement and has since been subject to criticism in that many officials and US families believe the settlement deal was underwhelming.
The deal that was made on Wednesday morning led to three guilty pleas to felony charges and a settlement valued at just over $8.3 billion.
Purdue Pharma agreed to pay a $3.5 billion criminal fine, an additional $2.8 billion civil liability and has also agreed to forfeit approximately $2 billion in past profits.
The money is said to primarily go towards opioid treatment programs.
The Controversy Behind the Decision
Even though Purdue Pharma filed for bankruptcy last year, the dollar amount of the settlement would completely restructure the pharmaceutical giant in that Purdue Pharma will now operate under government control as a public trust. Despite this, Purdue Pharma will still continue to manufacture various opioids.
The reason why Purdue Pharma has been ordered to continue operations as a public trust under governmental supervision is that the company did not have $8 billion in liquid cash to pay the fines. The future earnings will go towards paying the fines and penalties imposed on the firm in the decision made on October 21, 2020.
The real controversy stems from the fact that the owners and other company officials were not sentenced to any jail or prison time whatsoever.
New York Attorney General Letitia James responded to the deal via a written statement by saying “while our country continues to recover from the pain and destruction left by the Sacklers’ greed, this family has attempted to evade responsibility and lowball the millions of victims of the opioid crisis. Today’s deal doesn’t account for the hundreds of thousands of deaths or millions of addictions caused by Purdue Pharma and the Sackler family.”
Despite this, the Justice Department set up the deal in that future criminal charges are still possible for those involved in the marketing practices Purdue Pharma employed. The marketing investigation has been a separate federal investigation and is still ongoing.