Endo Health Solutions Inc. (EHSI) was ordered today to pay $1.086 billion 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 —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 the corporate entities. In addition, as part of the confirmed bankruptcy plan, the new company has funded voluntary trusts in settlement of opioid-relating 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 epidemic has caused substantial harm to the American people, and the companies whose unlawful tactics contributed to it must be held accountable,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “EHSI’s criminal guilty plea, and the sentence imposed upon it, further emphasizes the department’s commitment to prosecuting companies whose illegal conduct contributed to 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.”
“The sentencing in this case demonstrates the level of commitment FDA shares with our Department of Justice colleagues to address the opioid overdose crisis in the United States,” said Associate Commissioner Michael Rogers of FDA’s Office of Regulatory Affairs. “ENDO Health Solutions did not provide accurate information about the safety and abuse potential of their product, putting patients at additional risk of abuse and addiction. Such conduct undermines the agency’s public health mission and will not be tolerated. We will aggressively pursue and bring to justice those who knowingly endanger the nation’s public health.”
“The opioid epidemic is a plague on our country,” said Inspector General Robert P. Storch for the Department of Defense (DoD). “Our warfighters and their families sacrifice greatly for us, and we owe them a quality healthcare system free from corrupt corporate practices such as the ones perpetrated by this company. I applaud the U.S. Attorney’s Office, the Department of Justice and the investigative team from the DoD OIG’s Defense Criminal Investigative Service for their tenacious pursuit of justice in this case. This settlement sends a clear message to companies who place profits above the health and welfare of our warfighters, their families, and our retirees.”
“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.”
“The successful resolution of this case is a testament to the professionalism and teamwork displayed by our agents, our fellow investigative agencies, and the U.S. Department of Justice,” said Inspector General Kevin H. Winters for Amtrak. “We remain committed to protecting Amtrak employees, retirees, and their families by investigating any acts that could put them at risk, such as the misbranding of potentially dangerous drugs.”
“Through extensive false advertising efforts to conceal oxymorphone’s deleterious effects, Endo Health Solutions Inc. EHSI demonstrated a callous disregard for the safety and well-being of the people who were prescribed this highly addictive drug,” said Special Agent in Charge Jeffrey B. Veltri of the FBI Miami Field Office. “But thanks to the hard work of our partners including the Drug Enforcement Administration, the U.S. Department of Health and Human Services Office of Inspector General, the U.S. Food and Drug Administration Office of Criminal Investigations, the Veteran’s Administration Office of Inspector General, the U.S. Office of Personnel Management Office of the Inspector General, the Defense Criminal Investigative Service and the Amtrak Office of Inspector General, we are holding EHSI responsible for their significant contribution to the opioid epidemic.”
“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.”
In pleading guilty, EHSI admitted that certain sales managers were aware that the sales representatives were making claims of purported abuse deterrence, tamper resistance and/or crush resistance when marketing Opana ER to prescribers, and that certain sales representatives were striking non-medicated sample pills with hammers and conducting other demonstrations to convey the message that Opana ER was, in fact, crush proof and tamper resistant. The approved labeling for Opana ER did not provide adequate information for healthcare providers to safely prescribe Opana ER for use as an opioid that is abuse deterrent. According to the plea agreement, EHSI was responsible for the misbranding of Opana ER by marketing the drug with a label that failed to include adequate directions for its claimed abuse deterrence use, in violation of the FDCA.
EHSI withdrew Opana ER from the market in 2017.
The FBI, DEA, HHS-OIG, FDA-OCI, VA-OIG, OPM-OIG, DCIS and the Amtrak Office of Inspector General conducted the criminal investigation.
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.
For more information about the Consumer Protection Branch and its enforcement efforts visit www.justice.gov/civil/consumer-protection-branch.
Tips and complaints from all sources about potential fraud, waste, abuse and mismanagement can be reported to HHS, at 1-800-HHS-TIPS (800-447-8477).
Tags: Civil Lawsuit FDA Manufacturers Misbranded Opioid Crisis Oxymorphone Patient Harm Supply Chain