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Report: Purdue, US DOJ in talks to resolve OxyContin probes

Purdue Pharma LP is in talks with the U.S. Department of Justice to resolve investigations into the company's opioid painkiller OxyContin, The Wall Street Journal reported, citing anonymous sources.

The privately held pharmaceutical company is facing more than 2,000 lawsuits related to the manufacturing of opioids, employing deceptive marketing techniques and failing to report doctors who were prescribing the drug illegally, which contributed to the opioid epidemic in the U.S., according to multiple claims.

Purdue Pharma, which is owned by the Sackler family, proposed to settle the lawsuits against it for $10 billion to $12 billion in August.

The proposal entails the company filing for Chapter 11 bankruptcy, following which it would restructure into a "for-profit public benefit trust." Under the deal, Purdue would also donate $4 billion in drugs to treat opioid addiction, along with the profits from sales of drugs such as OxyContin, or the company's emergency opioid treatment Nalmefene.

A number of states, including New York, Massachusetts and Connecticut, are unwilling to accept the settlement, stating that the cash component of the proposal does not meet their demands, according to the Journal.

Federal agencies started investigations into Purdue as early as 2017. The probes are headed by the Justice Department in Washington along with the U.S. attorneys' offices in Connecticut, New Jersey and Vermont, and they have recently subpoenaed former employees, The Wall Street Journal reported Sept. 6.

The investigations encompass the company's order-monitoring systems and its failure to report illegal opioid prescriptions, while charges under continuing criminal enterprise statutes have also been considered, according to the Journal's sources.

A U.S. District Court judge in Ohio has ordered opioid makers, including Purdue Pharma, Johnson & Johnson, Endo International PLC, Allergan PLC, Mallinckrodt PLC and Teva Pharmaceutical Industries Ltd., to face an October trial that will determine whether the companies' marketing practices contributed to the painkiller addiction crisis.

The October trial is putting time pressure on Purdue Pharma's negotiations with federal agencies, states and other plaintiffs.

Mallinckrodt has proposed a settlement of all of its lawsuits in Ohio for a payment of $24 million in cash and a donation of $6 million in generic products. This settlement, if finalized, would resolve all cases against Mallinckrodt scheduled to go on trial in October.

The U.K.-based pharmaceutical company is also considering a restructuring, including bankruptcy options, to temper possible legal liabilities over its alleged contribution in the U.S. opioid crisis.

Meanwhile, Endo International has settled lawsuits in Ohio regarding its opioid marketing activities and will pay a total of $10 million.

J&J is appealing a ruling by an Oklahoma judge that ordered the pharmaceutical giant to pay $572 million in a suit brought by the state. Oklahoma attorneys accused the company of engaging in aggressive marketing of its painkillers, which contributed to the U.S. opioid epidemic.