Purdue Frederick pleads guilty in OxyContin case

NEW YORK Thu May 10, 2007 2:27pm EDT

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NEW YORK (Reuters) - Purdue Frederick Co. and three individuals pleaded guilty to charges of misbranding prescription painkiller OxyContin and will pay more than $634.5 million in penalties, the U.S. Justice Department said on Thursday.

The company pleaded guilty to felony misbranding of OxyContin with the intent to defraud and mislead, while its president, chief legal officer and former chief medical officer pleaded guilty to a misdemeanor charge of misbranding, the government said in a statement.

The Stamford, Connecticut-based company and the three admitted that they falsely claimed OxyContin was less addictive, less subject to abuse, and less likely to cause withdrawal symptoms than rival pain medications.

The U.S. Food and Drug Administration had not approved those claims.

"Purdue (Frederick) put its desire to sell OxyContin above the interests of the public," Assistant Attorney General Peter Keisler said in a statement. "Purdue abused the drug approval process which relies on drug manufacturers to be forthright in reporting clinical data and, instead, misled physicians about the addiction and withdrawal issues involved with OxyContin."

OxyContin, prescribed for patients with moderate to severe pain, is now regulated as a controlled substance with the same addictive potential as morphine.

The drug had become a favorite of narcotics abusers and was blamed for greatly contributing to several deaths. The FDA now requires the drug to carry a "black-box warning," the strongest type of warning for an FDA-approved drug, on its label.

The FDA "will continue to do all we can to protect the public against drug companies and their representatives who are not truthful and bilk consumers of precious health care dollars," Margaret O.K. Glavin, associate commissioner for regulatory affairs at the FDA, said in a statement.

Purdue Pharma LP, the drug manufacturer affiliated with Purdue Frederick, said in a statement that the three who pleaded guilty to a misdemeanor had violated company policies in the misbranding.

"Nearly six years and longer ago, some employees made, or told other employees to make, certain statements about OxyContin to some healthcare professionals that were inconsistent with the FDA-approved prescribing information for OxyContin and the express warnings it contained about risks associated with the medicine," Purdue Pharma said. "We accept responsibility for those past misstatements and regret that they were made."

The company said it has changed its internal training policies since then.

Of the settlement, $276 million will be forfeited to the United States, $160 million allocated to federal and state government agencies to resolve false claims for government healthcare programs and $130 million will go to resolving private civil claims.

Additional amounts will be paid to the Virginia Attorney General's Medicaid Fraud Control Unit and the Virginia Prescription Monitoring program.

The guilty pleas follow a $19.5 million settlement the related manufacturer of OxyContin, Purdue Pharma, made with 26 states and the District of Columbia this week over allegations it failed to adequately disclose abuse risks posed by the powerful narcotic.

Purdue Pharma had also settled a civil case brought by its insurer in June for $200 million.

(Additional reporting by Jeremy Pelofsky in Washington)

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