Purdue Pharma Scrambles To Discourage DOJ Enchantment of Chapter : NPR


Purdue Pharma’s headquarters in Stamford, Connecticut, April 2, 2019. With a federal judge poised to approve the company’s controversial Chapter 11 plan, the company works behind the scenes to forestall a legal challenge from the Department of Justice. Drew Angerer / Getty Images Hide caption

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Drew Angerer / Getty Images

Purdue Pharma’s headquarters in Stamford, Connecticut, April 2, 2019. With a federal judge poised to approve the company’s controversial Chapter 11 plan, the company works behind the scenes to forestall a legal challenge from the Department of Justice.

Drew Angerer / Getty Images

Purdue Pharma has launched a behind-the-scenes operation in the past few days to prevent the Justice Department from appealing a pending multi-billion dollar bankruptcy settlement for OxyContin maker.

NPR acquired an early draft of a letter distributed by the pharmaceutical company to groups that support the bankruptcy business.

The letter is formulated as a direct appeal to DOJ officials and is intended to be written by the injured at the company and members of the Sackler family.

“We speak together for the overwhelming majority of state and local governments, organizations and individuals harmed by Purdue and the Sacklers,” the letter reads.

Richter takes protective measures for Sackler in Purdue Pharma bankruptcy

The document makes no mention of the company’s role in starting the effort or creating the message.

The preventive pressure campaign comes after Federal Judge Robert Drain signaled that he will approve the plan at a hearing in White Plains, NY on Wednesday

Three sources, who know exactly the effort, have described it in detail in NPR.

Two of the people suggested that Purdue Pharma tried in good faith to protect a fragile settlement backed by most of the state and local governments that sued the Sacklers and their pharmaceutical company.

A third source expressed unease about the company’s efforts to prevent the DOJ from appealing.

All three indicated that the Justice Department’s challenge to a confirmed plan appeared likely but not certain.

They agreed to only add background because of the sensitive nature of the last minute negotiations aimed at gaining additional support for the agreement.

The letter warns that any appeal by the Justice Department would jeopardize “the delivery of billions of dollars” to communities struggling with high rates of addiction, overdose and death.

The language of the document suggests that Purdue Pharma hoped it would eventually be signed by attorneys general, local government officials, hospitals, and a group representing individual victims of the company’s opioid products.

Purdue Pharma declined to answer questions about the bankrupt company’s letter or offer to influence the Justice Department’s decisions.

Justice Department blows Purdue Pharma's bankruptcy plan

The Justice Department has not finalized whether it will challenge the settlement in court and declined NPR’s request for comment.

The Justice Department has condemned the deal

The deal has sparked controversy, in part because it would give members of the Sackler family and hundreds of their employees broad immunity from opioid lawsuits.

The remaining Sackler empire – including overseas pharmaceutical companies – will be protected from opioid liability, as will other independent companies that have worked with Purdue Pharma.

The Sacklers would not admit wrongdoing and will remain one of the richest families in the world.

In return, they would pay more than $ 4.3 billion over the next decade, the majority of which would be used to fund drug treatments and other health programs to alleviate the opioid crisis.

How a bankruptcy deal could offer a clean slate for opioid billionaires

During a two-week bankruptcy lawsuit that ended Friday, lawyers from two different branches of the DOJ said an appeal is possible.

They argued that the indemnities requested by the Sacklers were unlawful and would violate the constitutional rights of those with potential claims against the family.

In a legal brief, DOJ attorney William Harrington accused the Sacklers of playing the bankruptcy system to avoid responsibility for “alleged misconduct in framing and sustaining one of the worst public health crises the United States has ever seen”.

The letter, written by Purdue Pharma on behalf of the company’s victims, calls on the DOJ to accept the settlement with the Sacklers.

The letter describes a deal to protect family members from opioid lawsuits as “imperfect”. [but] better for those hit by the opioid epidemic than any other alternative. “

Purdue Pharma has long worked to influence decisions made by the Justice Department

Sources informed of Purdue Pharma’s lobbying indicated that such efforts were the order of the day in complex bankruptcy cases.

They also suggested revising the company’s letter before sending it to the Justice Department.

Members of the Sackler family played no part in drafting the document. It was unclear how many organizations involved in the bankruptcy business would eventually sign it.

Purdue Pharma has a long and successful history that has put pressure on decision makers at the DOJ.

In 2007, the firm’s lawyers pressured Justice Department officials to abandon plans to bring charges against company executives for illegal opioid marketing programs.

The Sacklers want immunity from the opioid crisis for a long list of their employees

Instead, Purdue officials pleaded guilty to criminal charges and paid more than $ 600 million in fines.

“At eleven o’clock, senior Justice Department officials blocked these charges, and as a result, much weaker and truly slapped agreements were made with these Purdue executives,” Senator Maggie Hassan, DN.H., said in a 2019 interview with NPR .

Last year, the company negotiated again with the DOJ in view of the looming new federal charges.

Purdue Pharma eventually pleaded guilty to the fraudulent marketing of OxyContin, but no individual charges were brought against company executives.

As part of that deal, the Sacklers agreed to pay the DOJ $ 225 million in a civil settlement. They were not charged with any crimes and did not admit any wrongdoing.

Some lawmakers are urging the DOJ to appeal the Purdue Pharma plan

Purdue Pharma isn’t the only one trying to sway the DOJ’s decision whether the bankruptcy settlement will be challenged after it’s approved.

Earlier this month, four Democratic MPs – two U.S. Senators and two House Representatives – wrote a letter to Attorney General Merrick Garland asking him to block the implementation of the plan.

“The DOJ still has time to play a key role in this case by filing an immediate direct appeal … on the constitutionality of the plan’s non-consensual releases,” lawmakers wrote.

Sens. Elizabeth Warren, D-Mass., And Richard Blumenthal, D-Conn., Signed the letter, as did the Reps. Carolyn Maloney, DN.Y., and Mark DeSaulnier, D-Calif.

Meanwhile, during the bankruptcy proceedings, critics of the plan suggested that an appeal would be all but certain if approved by Drain, the judge.

“We urge you not to make the historic mistake of upholding this plan,” argued Matthew Gold, an attorney representing Washington, Oregon and the District of Columbia who are still opposed to the settlement.

“The plan contains fatal flaws [and] will be overturned on appeal, “Gold said during a hearing on Aug. 23.

Proponents of the plan say it will help alleviate the opioid crisis

But proponents of the plan argue that it would quickly distribute money to fund drug treatments and other health programs aimed at alleviating the opioid crisis.

“A long, messy appeal is not helping the people who are still struggling, nor is it helping rebuild communities destroyed by the crisis,” argued Arik Price, an attorney who represents groups harmed by Purdue Pharma and the settlement Have accepted. He also spoke during the bankruptcy hearing on August 23.

Purdue Pharma introduced OxyContin in the late 1990s. Critics say the company’s aggressive and sometimes misleading marketing campaigns have persuaded doctors to prescribe opioids more generously, helping to usher in the deadly opioid crisis.

More than 500,000 Americans have died from fatal overdoses, according to the Centers for Disease Control and Prevention.

By their own estimates, the Sacklers made more than $ 10 billion from opioid sales, though they say nearly half of that money was used for taxes.

Family members who served on Purdue Pharma’s board of directors have repeatedly stated that they have done nothing wrong and acted ethically.

However, documents released during the trial show that some family members continued to sell highly addictive opioid pills long after the rates of abuse and overdose began to rise.

During the process, Drain urged those involved in drafting the bankruptcy deal to limit indemnities for the Sacklers and their employees.

But during a final hearing on Friday, Drain spoke at length about his fears the deal could still be challenged on appeal. He warned that such an appeal would delay the distribution of much-needed funds.

“One thing that is crystal clear from the record of the trial is that time is nobody’s friend,” Drain said.