Report: Feds seek multibillion-dollar payout from OxyContin-maker Purdue Pharma
STAMFORD — U.S. Department of Justice officials are reportedly seeking up to $18 billion from bankrupt OxyContin-maker Purdue Pharma, which is trying to settle thousands of lawsuits that allege its marketing fueled the national opioid crisis.
The Justice Department has valued its civil claims at $2.8 billion — an amount that could be legally tripled — and it could also seek a multibillion-dollar fine and a forfeiture worth several billion dollars if the company were criminally charged and convicted, according to yet-to-be submitted filings that were seen by The Wall Street Journal.
Reuters first reported on the Justice Department’s criminal and civil claims in Purdue’s bankruptcy and the amounts. U.S. prosecutors are pursuing nearly $13 billion of claims, Reuters reported Tuesday.
In comparison, Purdue has offered a comprehensive settlement of the pending lawsuits that it has valued at more than $10 billion since it filed for bankruptcy last September.
“As Purdue Pharma has previously stated, the company is cooperating with investigative demands by various components of the U.S. Department of Justice in connection with criminal and civil investigations of the company,” Purdue said in a statement Thursday. “Purdue Pharma is engaged in ongoing discussions with the Department of Justice regarding a potential resolution of these investigations, and therefore the company has no comment at this time.”
A message left Thursday for the Justice Department was not immediately returned.
Last year, reports emerged that the talks between Purdue and Justice Department officials were focusing on civil and criminal probes that have examined Purdue’s possible failure to report doctors who were illegally prescribing opioids and the firm’s order-monitoring systems.
In October 2017, Purdue confirmed it was under investigation by the U.S. attorney’s office in Connecticut and said it was cooperating with the inquiry. A spokesman for the Connecticut USAO declined to comment Thursday.
In 2007, a Justice Department-led investigation of Purdue produced the most-severe sanctions of the company. In that case, it pleaded guilty in federal court to misbranding OxyContin, resulting in $635 million in company and individual penalties.
Negotiating a payout to the Justice Department could hinder Purdue’s efforts to settle the approximately 3,000 local and state lawsuits that allege the company fueled the opioid crisis with fraudulent OxyContin marketing. It put its settlement offer on the table when it filed for bankruptcy in U.S. District Court in White Plains, N.Y.
Since seeking Chapter 11 protection, Purdue has incurred about $277 million in litigation and bankruptcy fees, surpassing comparable expenditures that it made last year.
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