Additional Coverage:
A federal judge has ordered Purdue Pharma to pay over $5 billion in criminal penalties, paving the way for the opioid drugmaker to finalize its bankruptcy settlement and resolve thousands of lawsuits related to the opioid epidemic. The ruling was issued Tuesday by a federal court in Newark, New Jersey.
Purdue Pharma, owned by the Sackler family, pleaded guilty in October 2020 to charges linked to its role in fueling the opioid crisis, which has claimed hundreds of thousands of lives nationwide. Prosecutors accused the company of aggressively marketing addictive opioids like OxyContin while minimizing the risks of addiction and overdose.
Facing thousands of lawsuits from states, local governments, tribes, and other plaintiffs, Purdue filed for Chapter 11 bankruptcy in 2019 as part of a deal to address the legal claims. The recent sentencing clears the way for Purdue to be dissolved and replaced by Knoa Pharma, a new public benefit company that will inherit Purdue’s assets and continue producing addiction treatment and overdose-reversal medications.
” Purdue Pharma put profits over patient health and safety,” said Acting Attorney General Todd Blanche in a statement announcing the sentence. “The company willfully rejected the law and ignored the diversion of their highly addictive prescription drugs.”
The opioid epidemic has had a devastating toll, with the Centers for Disease Control and Prevention reporting approximately 806,000 opioid overdose deaths between 1999 and 2023.
Court documents detail Purdue’s illegal marketing practices from 2007 to 2017, which generated billions in profit. The penalties include a $3.544 billion criminal fine and $2 billion in criminal forfeiture. The Justice Department noted that up to $1.775 billion will be credited against the forfeiture based on payments made to state, local, and tribal governments through the bankruptcy process.
“No penalty can undo the widespread devastation Purdue has inflicted, but today’s sentence serves as long-overdue accountability for its reckless and unlawful conduct,” said T. March Bell, Inspector General of the U.S. Department of Health and Human Services.