Purdue Pharma L.P., as well as its president, top lawyer and former chief medical officer will pay $634.5 million in fines for claiming the drug was less addictive and less subject to abuse than other pain medications, U.S. Attorney John Brownlee said.
The plea agreement settled a national case and came two days after the Stamford, Conn.-based company agreed to pay $19.5 million to 26 states and the District of Columbia to settle complaints that it encouraged physicians to overprescribe OxyContin.
"With its OxyContin, Purdue unleashed a highly abusable, addictive, and potentially dangerous drug on an unsuspecting and unknowing public," Brownlee said. "For these misrepresentations and crimes, Purdue and its executives have been brought to justice."
Purdue spokesman James Heins objected to the suggestion of a connection between the plea agreement and individuals' abuse of OxyContin.
"We promoted the medicine only to health-care professionals, not to consumers," he said in a statement.
Purdue learned from focus groups with physicians in 1995 that they were worried about the abuse potential of OxyContin. The company then gave false information to its sales representatives that the drug had less potential for addiction and abuse than other painkillers, the U.S. attorney said.
Ken Jost of the Justice Department's Office of Consumer Litigation said this case should put pharmaceutical companies on notice that they won't be able to get away with breaking the law to make a profit.
"The things that they plot in their boardrooms, the things that they do behind closed doors will not stay behind closed doors," Jost said. "We have the people, we have the resources. We'll take the time and we'll take the effort to find out what they did and how they did it."
Purdue Pharma said it accepted responsibility for its employees' actions.
"During the past six years, we have implemented changes to our internal training, compliance and monitoring systems that seek to assure that similar events do not occur again," the company said in a news release.
OxyContin, a trade name for oxycodone, is a time-release painkiller that can be highly addictive. Designed to be swallowed whole and digested over 12 hours, the pills can produce a heroin-like high if crushed and then swallowed, snorted or injected.
From 1996 to 2001, the number of oxycodone-related deaths nationwide increased 400 percent while the annual number of OxyContin prescriptions increased nearly 20-fold, according to a report by the U.S. Drug Enforcement Administration. In 2002, the DEA said the drug caused 146 deaths and contributed to another 318. In western Virginia, the state medical examiner's office listed oxycodone as the cause of death of 228 people from 1996 to 2005, a spokeswoman for Brownlee said. The U.S. attorney said the guilty pleas were entered Thursday morning in U.S. District Court in Abingdon, about 135 miles southwest of Roanoke. In an unusual move, Brownlee said, company chief executive officer Michael Friedman, general counsel Howard Udell and former chief medical officer Paul Goldenheim each pleaded guilty to a misdemeanor count of misbranding the drug. Of the total fine, $34.5 million was levied on those three. The fines will be distributed to state and federal law enforcement agencies, the federal government, federal and state Medicaid programs, a Virginia prescription monitoring program and individuals who had sued the company. About $5 million will go toward a six-year company program to monitor compliance with the agreement. When he took office in 2001, Brownlee said, his office was handling a number of cases related to OxyContin abuse, including crimes by addicts seeking to support their habits and arrests of street dealers and even pharmacists and physicians. "But it always seemed I think to me and to the investigators that there was more," he told a news conference. Investigators from a number of state and federal agencies worked together on an investigation of the Purdue and began to subpoena company records in 2002, Brownlee said. "From these millions of records, they picked out probably 300 to 500 documents and pieced together a case," he said. The Food and Drug Administration was part of the investigation, but Connecticut Attorney General Richard Blumenthal said in a statement that the agency had not acted on a citizen petition Blumenthal's office filed more than three years ago. The petition raised concerns about misbranding and called for stronger warnings and fuller disclosure about OxyContin's dangers. Kim Rice of the FDA told the news conference that the agency has mandated warnings on labels about OxyContin's abuse potential that have grown stronger over time. Purdue Pharma recruited high-profile help in 2002 as the nation's number of ocycodone-related deaths rose dramatically. It hired former New York City Mayor Rudy Giuliani's firm, Giuliani Partners, to try to prevent smuggling and abuse of the drug. "Purdue has demonstrated its commitment to fighting this problem in launching practical and novel solutions including the provision of tamper-resistant prescription pads to over 10,000 physicians and implementing its highly acclaimed â€˜Painfully Obvious' teen education program," Giuliani said at the time. --- Associated Press writer Sharon Theimer in Washington, D.C., contributed to this report. AP-CS-05-10-07 1819EDT