Newly public documents paint a detailed and often damning portrait of the role played by members of the Sackler family, owners of Purdue Pharma, during years when the privately owned drug company launched criminal schemes designed to "turbocharge" sales of Oxycontin and other highly addictive opioid medications.
In court filings this week, Purdue Pharma admitted extensive criminal wrongdoing as part of a settlement with the Justice Department, including a decade-long conspiracy to deceive the Drug Enforcement Administration that continued until 2017.
"The abuse and diversion of prescription opioids has contributed to a national tragedy of addiction and deaths," Deputy Attorney General Jeffrey Rosen said in a statement after the guilty plea was entered.
This isn't the first time the company admitted criminal wrongdoing in its effort to boost opioid profits on the Sackler's watch.
In 2007, the family's firm pleaded guilty to charges in a DOJ settlement and agreed to pay more than $600 million in fines, while promising to follow strict new ethics guidelines. The Sacklers then faced no criminal charges.
But company officials now acknowledge Purdue Pharma almost immediately launched new criminal schemes aimed at boosting opioid sales, even as overdoses were killing tens of thousands of Americans.
"Purdue deeply regrets and accepts responsibility for the misconduct detailed by the Department of Justice," Purdue Pharma's board chair Steve Miller said in a statement.
What role did members of the Sackler family play in that misconduct?
NPR reviewed internal company records from the last decade, including memos, planning documents and emails between family members, disclosed in recent weeks as part of civil and criminal proceedings, as well as during a congressional probe.
They reveal how the Sacklers appeared to exert close control over the firm, pressuring staff to boost sales during the period when much of the illegal activity occurred.
In one 2010 email cited by DOJ, Richard Sackler scolded company executives for not setting higher sales quotas for Oxycontin.
"I'm disappointed and don't agree with you. This is a matter that the board will have to take up and give you a settled direction," Sackler wrote.
A consultant who helped develop the company's aggressive sales tactics claimed in a 2013 memo that family members were the only decision-makers in the room during a key meeting.
In another email from 2017 cited by the Justice Department, a top Purdue Pharma executive describes the Sacklers acting as the "de-facto CEO" of their drug company.
Despite these revelations, the newDOJ settlement again did not require Sackler family members to admit any wrongdoing, nor do they face criminal prosecution.
The deal instead requires them to forfeit $225 million as part of a civil penalty separate from Purdue Pharma's criminal plea. That amount represents a small fraction of the estimated $10 to $13 billion they accrued from opioid sales.
"I'm very disappointed," said Nan Goldin, an artist and activist who became addicted to Oxycontin in 2014 and has since led protests against the Sacklers. "I think we're going further toward injustice."
The lack of criminal charges is controversial, in part, because the Justice Department itself alleges in new filings that members of the Sackler family approved a scheme to boost opioid prescribing that the company now admits was illegal.
Acting on the family's authority Purdue Pharma "intensified their marketing of OxyContin to extreme, high-volume prescribers who were already writing 25 times as many OxyContin scripts as their peers," according to the DOJ.
Federal prosecutors name David Sackler, Jonathan Sackler, Kathe Sackler, Mortimer Sackler and Richard Sackler as playing a direct role in that effort.
Justice Department officials also allege the Sacklers engaged in "fraudulent" financial activity, as they worked to shelter billions of dollars in opioid profits from future lawsuits.
In one email exchange from 2014 cited by the Justice Department, board member Jonathan Sackler proposed a "smart milking" program to drain value from the company at a time when legal and regulatory challenges were growing.
According to the DOJ, criminal charges may still be filed against individuals at Purdue Pharma, but legal experts tell NPR that appears unlikely.
"I don't see a strong likelihood the government is going to want to indict," said John Coffee Jr., an expert on corporate crime at Columbia University.
He added the Sacklers have "been playing this game for fifteen years and it has worked for them."
The Sacklers, meanwhile, maintain they did nothing wrong.
In a statement issued last month after the outlines of the DOJ deal were made public, members of the family said they "acted ethically and lawfully."
They described as "proper" billions of dollars of financial distributions funneled into private trusts and offshore accounts.
But the company's many critics say a starkly different story is emerging as the wall of secrecy surrounding the Sacklers' actions continues to crumble.
In a legal brief filed this month in federal bankruptcy court, attorneys representing 25 states argued evidence is now overwhelming that the Sacklers engaged in "pervasive fraud and crime."
The growing list of allegations is lengthy, but the big picture is relatively simple.
As sales of the family's rockstar drug Oxycontin began to decline over the last decade, members of the Sackler family allegedly pushed ever more aggressive efforts to maximize profits.
To meet those goals, they hired a consultant tasked with creating a campaign to "turbocharge the sales engine."
Purdue Pharma now admits many of the company's most aggressive sales tactics during this period were illegal. Criminal behavior described in the plea agreement includes:
- Paying kickbacks to a software company after it agreed to embed "prompts" in the handheld devices used by physicians. Without their knowledge, doctors were urged to prescribe Oxycontin and other Purdue products, even when other treatments might be safer and equally effective.
- Misleading the DEA by claiming Purdue Pharma had an effective program to prevent diversion and misuse of Oxycontin, as required by law. In fact, the company was deliberately marketing opioids to doctors who were behaving suspiciously.
On the Sacklers' watch, Purdue Pharma and its consultants also developed questionable schemes that were never implemented, including a plan to secretly pay insurance companies thousands of dollars every time a patient became addicted or overdosed while using Oxycontin.
Due in part to these revelations, the settlement with the Sacklers has sparked outrage among lawmakers. Thirty members of Congress sent a letter to Attorney General William Barr last month in an unsuccessful effort to block the new deal.
They noted that street dealers who admit to selling much smaller quantities of opioids often spend years in federal prison.
Under this latest settlement, the Sacklers give up ownership of the company and Purdue Pharma has promised to eventually pay roughly $8.3 billion in fines and penalties.
But it appears unlikely the money will ever materialize. While the Sacklers have emerged as one of the richest families in America, their company entered bankruptcy last year facing a tsunami of opioid-related lawsuits.
"They've stripped the company of its assets," said John Coffee Jr. at Columbia University. "We can pile up to the billions the penalties [Purdue Pharma] pleads guilty to, but there are no assets to pay them with. It's illusory."
Under the Justice Department agreement, Purdue Pharma may emerge following bankruptcy as a "public benefit corporation," with future profits from future opioid sales going to compensate individuals and communities harmed by the addiction crisis.
That arrangement, too, has faced criticism from members of Congress and two dozen state attorneys general, who object to the government entering into a long-term financial relationship with a drug company linked to persistent criminal activity.
The House Committee on Oversight and Reform has scheduled a hearing on the Purdue Pharma settlement for Dec. 8. Democrats who control the committee have invited members of the Sackler family as well as company CEO Craig Landau to testify.
Copyright 2020 NPR. To see more, visit https://www.npr.org. 9(MDAxMzY2MjQ0MDEyMzcyMDQ5MzBhZWU5NA001))
