Magazine article Developments in Mental Health Law

Company Producing OxyContin and Three Executives Plead Guilty to Federal Charges of Misbranding

Magazine article Developments in Mental Health Law

Company Producing OxyContin and Three Executives Plead Guilty to Federal Charges of Misbranding

Article excerpt

The Purdue Frederick Company, Inc., the company that makes the narcotic painkiller OxyContin, and three current and former executives pled guilty in federal court to criminal charges of misbranding, a plea accepted by the federal Western District Court of Virginia. Federal law makes it a crime to mislabel a drug, fraudulently promote it, or market it for an unapproved use. The charges alleged that the defendants misled physicians and consumers about the drug's risk of addiction and potential to be abused.

The company agreed to more than $600 million in sanctions. This was reported to be the third-highest amount ever paid by a drug company in such a case and to represent about 90% of the profits for sales of the drug during the time period of the offense. This amount included roughly $100 million payable to federal government health care agencies, $60 million in escrow for those states that elect to settle their claims against Purdue, $20 million in trust to the Commonwealth of Virginia for operating the Virginia Prescription Monitoring Program, a $276 million forfeiture to the United States, and $130 million to settle private civil claims related to OxyContin. The executives who pled guilty included the company's former president and CEO, its executive vice president and chief legal officer, and its former chief scientific officer. They agreed to pay a total of $34.5 million in fines.

Supervisors and employees of Purdue Pharma had told health care providers that because of its time-release formulation it posed a lower threat of abuse and addiction than traditional, shorter-acting painkillers. This became the theme of what was reported to have been the most aggressive marketing campaign ever undertaken by a pharmaceutical company. This campaign was alleged to have targeted general practitioners who had little training in the treatment of serious pain or in recognizing signs of drug abuse in patients. The drug was introduced in 1996, but by 2000 several parts of the country, particularly rural areas, reported skyrocketing rates of addiction and crime related to the drug's use, which could produce a high as powerful as provided by heroin.

According to the prosecutor in the case, who claimed that this was "one of our nation's greatest prescription drug failures," the company knew that its claims that OxyContin was less addictive and less subject to abuse were false. Further, the prosecutor asserted that "the genesis of OxyContin was not the result of good science or laboratory experiment, [but rather] the child of marketers and bottom line financial decision making." The prosecutor asserted that the annual number of prescriptions for OxyContin reached six million a year, with the federal Drug Enforcement Agency reporting that 464 deaths were caused or most likely caused by OxyContin, with 228 people in western Virginia dying from overdoses from 1996 to 2005. In addition, the prosecutor contended that localities began to report dramatically higher crime rates, some up as much as 75% from the year before, which was directly attributable to the abuse of OxyContin.

The prosecutor further contended that company officials had recognized that the drug would face stiff resistance from doctors concerned about the potential of a powerful narcotic such as OxyContin to be abused or cause addiction and thus deliberately crafted its fraudulent marketing campaign to overcome these concerns. …

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