DOJ makes $8B settlement with Purdue Pharma, OxyContin manufacturer, for role in opioid crisis

The company has been widely blamed for fueling the nation’s opioid epidemic.

October 21, 2020, 12:21 PM

The Justice Department announced an $8 billion settlement with Purdue Pharma, the OxyContin maker widely accused of fueling the nation's opioid crisis that has been blamed for more than 400,000 American deaths in the last 20 years.

The settlement resolves criminal and civil investigations into how Purdue Pharma aggressively marketed its powerful painkillers but the staggering amount is largely symbolic. The company is tied up in bankruptcy proceedings and lacks the assets to pay the full amount.

Member of the wealthy Sackler family that control the company will separately pay $225 million to resolve civil claims.

The settlement agreement does not prevent family members or company executives from being prosecuted in the future.

Members of the Sackler family involved with the company said those who served on the Pharma's board of directors acted "ethically and lawfully," which would be proven in "the upcoming release of company documents," a statement from family on Wednesday read.

"We reached today’s agreement in order to facilitate a global resolution that directs substantial funding to communities in need, rather than to years of legal proceedings," the statement continued.

Deputy Attorney General Jeffrey A. Rosen holds a news conference to announce the results of the global resolution of criminal and civil investigations with an opioid manufacturer at the Justice Department in Washington, D.C., Oct. 21, 2020.
Yuri Gripas/Pool via AP

"The abuse and diversion of prescription opioids has contributed to a national tragedy of addiction and deaths, in addition to those caused by illicit street opioids," said Deputy Attorney General Jeffrey A. Rosen in a statement. "With criminal guilty pleas, a federal settlement of more than $8 billion, and the dissolution of a company and repurposing its assets entirely for the public's benefit, the resolution in today's announcement re-affirms that the Department of Justice will not relent in its multi-pronged efforts to combat the opioids crisis."

"This resolution does not provide anybody with a pass on the criminal side," said Rachel Honig, an assistant U.S. attorney in New Jersey.

The company is pleading guilty on three counts: one charge of defrauding the United States and two anti-kickback-related charges.

"Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice in the agreed statement of facts," said Stephen Miller, Purdue Pharma's chairman of the board in a statement released Wednesday.

Miller said resolving the DOJ's investigation was an "important step in our bankruptcy process."

The company will operate under different ownership, will be overseen by new trustees and will offer "milllions of doses of livesaving opioid addiction treatment and overdose" medicine for free or "at cost," per the company's statement.

"The department will not relent to combat the opioid problem," Deputy Attorney General Jeffery Rosen said at a press conference on Wednesday.

Rosen said that according to the plea agreement, and subject to bankruptcy court approval, Purdue Pharma will be "be dissolved and won't exist in its current form."

Two dozen states, however, have opposed Purdue's plans to turn itself into a public trust.

"DOJ failed," said Massachusetts Attorney General Maura Healey. "Justice in this case requires exposing the truth and holding the perpetrators accountable, not rushing a settlement to beat an election. I am not done with Purdue and the Sacklers, and I will never sell out the families who have been calling for justice for so long."

PHOTO: The Purdue Pharma logo at its offices in Stamford, Conn., May 8, 2007.
The Purdue Pharma logo at its offices in Stamford, Conn., May 8, 2007. Purdue Pharma makes OxyContin, the powerful prescription painkiller that experts say helped touch off an opioid epidemic.
Douglas Healey/AP, FILE

"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," New York Attorney General Letitia James said Wednesday. "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. Instead, it allows billionaires to keep their billions without any accounting for how much they really made. From the beginning, we've aimed to unearth how much the Sacklers actually profited and how much they continue to hide away. While no amount of money can ever compensate the pain that so many now know, we will continue to litigate our case through the courts to secure every cent we can to limit future opioid addictions. We are committed to holding the Sacklers and others responsible for the role they played in fueling the opioid crisis."

This report was featured in the Thursday, Oct. 22, 2020, episode of “Start Here,” ABC News’ daily news podcast.

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Editor's note: Sackler family reference has been clarified.