Endo Health Solutions Inc. (EHSI) was ordered Friday to pay a billion dollars in criminal fines and an additional $450 million in criminal forfeiture — the second-largest set of criminal financial penalties ever levied against a pharmaceutical company.
The fines were for violations of the Federal Food, Drug and Cosmetic Act related to the distribution of the opioid medication Opana ER with INTAC (Opana ER).
EHSI pleaded guilty on April 18 to one misdemeanor count of introducing misbranded drugs into interstate commerce.
In pleading guilty, EHSI admitted that from April 2012 through May 2013, certain EHSI sales representatives marketed Opana ER to prescribers by touting the drug’s purported abuse deterrence, tamper resistance, and/or crush resistance, despite a lack of clinical data supporting those claims.
EHSI’s corporate affiliates emerged from bankruptcy on April 23. EHSI will cease to operate in its current form and will not emerge from bankruptcy.
Payment of the criminal fine imposed at sentencing is addressed as a component of the broader resolution resolving all monetary claims held by the United States against corporate entities.
In addition, as part of the confirmed bankruptcy plan, the new company has funded voluntary trusts to settle opioid-related claims, including public trusts that will pay over $450 million to state, municipal, and Tribal entities to help fund programs to abate the opioid crisis.
The department is crediting up to $450 million of such payments against the agreed forfeiture amount.
The EHSI affiliates that have emerged from bankruptcy are subject to an injunction restraining future opioid sales and marketing and requiring the publication of millions of documents relating to its role in the opioid crisis.
“The opioid crisis we continue to face today originated, in part, from companies like EHSI building their business on false claims and deceptive business practices,” said DEA Administrator Anne Milgram. “By intentionally misrepresenting opioid medications, EHSI prioritized profits over the health and well-being of the American people. Today’s settlement reflects DEA’s commitment to keep Americans safe and holding companies like EHSI accountable.”
“Today’s sentencing holds the defendants accountable for their role in the long-term deceptive practice of making false statements related to the safety of the opioids they were marketing,” said Inspector General Michael J. Missal for the Department of Veterans Affairs (VA). “The VA Office of Inspector General thanks the Department of Justice and our law enforcement partners for their efforts in this joint investigation.”
“Putting people first is at the core of our mission and our agency will continue to be relentless in investigating companies that endanger people in order to boost profits through aggressive, unlawful marketing and misbranding of products,” said Christi A. Grimm of the Department of Health and Human Services Office of Inspector General (HHS-OIG). “Working closely with our partners across several agencies, HHS-OIG remains committed to protecting federal health care programs and the health and safety of people served by those programs.”
EHSI pleaded guilty and acknowledged that some sales managers knew their representatives were falsely promoting Opana ER as abuse-deterrent and tamper-resistant. The sales reps demonstrated this by using hammers on dummy pills to falsely show that the drug was crush-proof, officials stated.
The label on Opana ER lacked sufficient information for safe prescription as an abuse-deterrent opioid. Under the plea agreement, EHSI admitted to misbranding Opana ER by marketing it with inadequate instructions for its claimed abuse deterrence, violating the FDCA
EHSI withdrew Opana ER from the market in 2017.
Assistant Director Gabriel H. Scannapieco and Trial Attorneys Ben Cornfeld, Brant Cook, Tara M. Shinnick and Colin Trundle of the Civil Division’s Consumer Protection Branch prosecuted the case.