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Purdue Pharma set to dissolve after judge approves its criminal sentence

NEWARK, N.J. (AP) — OxyContin maker Purdue Pharma is set to be dissolved and replaced by a company focused on the public good by the week’s end, as a massive legal settlement resolving thousands of lawsuits takes effect.

A federal judge on Tuesday delivered a criminal sentence to the company to resolve a U.S. Department of Justice probe — a last necessary step to clear the way for the settlement.

U.S. District Judge Madeline Cox Arleo made her decision after listening to hours of impact statements from people who lost loved ones or struggled with addiction themselves and requested she reject the negotiated sentence. While she didn’t go that far, she said she sympathized with people who bore the brunt of an epidemic linked to more than 900,000 deaths in the U.S. since 1999.

Purdue reached a deal with the Justice Department in 2020 to resolve criminal and civil probes the company was facing.

The Stamford, Connecticut-based company admitted it did not have an effective program to keep its powerful prescription painkillers from being diverted to the black market, even though it told the U.S. Drug Enforcement Administration that it did.

It also admitted it paid doctors through a speakers program to prescribe the drugs and paid an electronic medical records company to send doctors information on patients that encouraged more opioid prescriptions.

Steve Miller, who became chairman of Purdue’s board to guide the company through the bankruptcy process and will cease to have that position when the company is dissolved, addressed the hearing: “I deeply apologize on behalf of the company for everything they did,” he said.

Only the company was charged — not individual employees or owners.

The guilty plea and civil settlement with the federal government included $8.3 billion in forfeitures, fines and penalties. But the federal government agreed in a negotiated settlement to collect just $225 million in exchange for Purdue reaching a separate settlement of the thousands of lawsuits it faced from state, local and Native American tribal governments, along with other groups. Purdue’s guilty plea did not include restitution to victims.

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