Trump administration expected to settle with Purdue Pharma considered victory for opioid victims: report

Purdue Pharma has been negotiating with the Trump administration's Justice Department to resolve thousands of lawsuits accusing the pharmaceutical company of of helping to spark an opioid epidemic that has contributed to more than 400,000 deaths in the U.S., according to a report by the New Yorker.

Lawyers familiar with the situation told the New Yorker that the administration has been pushing to finalize the deal before Election Day in an effort to present the settlement as a major victory against Big Pharma.

The settlement is reportedly expected to involve a fine but no charges against individual executives, potentially allowing the Sackler family to keep their billions of dollars in wealth.

The lawsuits against Purdue allege that the company used deceptive marketing and took other improper steps to flood communities with prescription opioids including OxyContin. At least 430,000 deaths in the U.S. since 2000 have been connected to overdoses from opioids, according to the CDC.

Purdue Pharma previously announced its intention to settle when it filed for bankruptcy protection in September 2019.

Purdue Pharma declined to comment and the Department of Justice did not immediately return FOX Business' request for comment on the potential settlement.

U.S. PURSUES NEARLY $13 BILLION OF CLAIMS IN PURDUE PHARMA OPIOID PROBES, SOURCES SAY

According to a term sheet obtained by the New Yorker, the family reportedly said that it is willing to pay $3 billion with the caveat that it is released from “all potential federal liability arising from or related to opioid-related activities.”

Bankruptcy judge Robert Drain told the court in February that the “only way to get true peace, if the parties are prepared to support it and not fight it in a meaningful way, is to have a third-party release,” suggesting authorities should be barred from bringing future suits against the Sacklers.

One attorney familiar with the case reportedly argued, however, that criminal liability is "not something that should be sold."

"It should not depend on how rich they are," the lawyer told the New Yorker. "It's not right."

A letter from a group of five senators was sent to Drain on Sept. 21 arguing that "no business should seek to reward any employee that has engaged in criminal practices."

"Executives in leadership roles must be held accountable for their actions," the senators wrote. "This proposed incentive structure represents an affront to the thousands of families that have been harmed by the opioid crisis, and an entirely inappropriate exercise given the impact of Purdue’s continued recklessness."

PURDUE PHARMA ORDERED TO STOP SOME POLITICAL CONTRIBUTIONS DURING ONGOING BANKRUPTCY CASE

The new potential deal comes following a previous settlement in 2007 after Purdue Pharma and three of its executives plead guilty to criminal charges related to fraudulently marketing of OxyContin from late 1995 to 2001.

Former officials involved in the 2007 case told the New Yorker that Purdue’s lawyers, including Mary Jo White, the former U.S. Attorney for the Southern District of New York; Rudy Giuliani, the former New York City mayor; and Howard Shapiro, the former general counsel of the F.B.I., persuaded the political leadership in the Bush Justice Department to scuttle the prosecution. In May 2007, U.S. Attorney for the Western District of Virginia, John Brownlee, announced that Purdue had pleaded guilty to felony misbranding and had agreed to pay more than half a billion dollars in fines.

In a letter this week to Attorney General William Barr, Democratic Senators Maggie Hassan of New Hampshire and Sheldon Whitehouse of Rhode Island cited the agency's "history of leniency with Purdue Pharma" and expressed concern that the DOJ will "once again let connected lawyers obtain a settlement that does not adequately address the harms caused by the company."

The senators are demanding that any settlement receives the required approvals and is made public in a written statement along with any "referral memoranda." The lawmakers are also asking for a compromising or closing memorandum fully explaining the basis for the settlement and for the DOJ to ensure that the final settlement does not "bargain away" the agency or other government entities' ability to pursue related civil or criminal claims against the Sackler family.

In addition, the group has renewed August 2018 and September 2019 requests for the 2006 prosecution memo and for additional information and documents related to the DOJ’s decision to "settle this matter for misdemeanor charges." They also are requesting any communications between the DOJ, Rudy Giuliani and Giuliani Partners, Mary Jo White, and Howard Shapiro in their capacity as representatives in the previous case.

CLICK HERE TO READ MORE STORIES ON FOX BUSINESS 

According to Reuters, a group of U.S. states claimed in August that they are owed $2.2 trillion to address harm from the drugmaker's alleged role in America's opioid epidemic, accusing the company of pushing prescription painkillers on doctors and patients while playing down the risks of abuse and overdose.

Forty-nine states, Washington, D.C., and various territories are reportedly making the claims. The New Yorker noted roughly 29 have named members of the Sackler family as defendants.

Both Purdue Pharma and the Sackler family have denied the allegations against them and have pledged to help combat the opioid epidemic by providing addiction treatment drugs and overdose reversal medications currently under development.

Representatives for the families of Raymond and Mortimer Sackler did not immediately return FOX Business' request for comment, but told the New Yorker that the family members on Purdue's board "were consistenly assured by management that all marketing of OxyContin was done in compliance with law.”

"Our hearts go out to those affected by drug abuse and addiction,” the statement continued. “The rise in opioid-related deaths is driven overwhelmingly by heroin and illicit fentanyl smuggled by drug traffickers into the U.S. from China and Mexico.”

In addition, the representative said documents will show 'the Sackler family acted ethically and responsibly at all times'.

GET FOX BUSINESS ON THE GO BY CLICKING HERE 

The Associated Press contributed to this report.