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Judge Questions Purdue Pharma Plea Agreement

A federal judge is challenging the plea agreement entered into earlier in 2007 between prosecutors and Purdue Pharma, the manufacturer of OxyContin. The Roanoke Times reported on June 20, 2007 ("Oxycontin Agreement Challenged By Judge") that "A federal judge is raising questions about a plea agreement that calls for $634.5 million in fines -- but no jail time -- for the illegal marketing of OxyContin, a powerful painkiller that doubles as a street drug. Before sentencing three Purdue Pharma executives next month, U.S. District Judge James Jones will consider responses to 16 questions he recently submitted to federal prosecutors and company officials. One of the questions: Why should the executives not be sent to jail? 'While it certainly is appropriate for the corporate officials to be held accountable for the actions of the company, a sentence of incarceration ... would be unusual,' prosecutors responded in court filings."

According to the Times, "Following a six-year federal investigation, company president Michael Friedman, chief legal officer Howard Udell and former head of medical affairs Paul Goldenheim agreed to pay a combined $34.5 million in fines. The company will pay another $600 million as part of an agreement that calls for Jones to place its top officials on probation. It's unusual for a judge to have so many questions about a plea agreement. Although Jones asked prosecutors to justify what the plea agreement calls 'non-incarcerative sentences,' it was unclear whether his question indicates any concerns about the lack of jail time."

The Times noted that "Prosecutors agreed that it would be 'legally difficult and burdensome' to identify possible victims of OxyContin abuse in the context of a criminal proceeding against the company. Complicating the issue further is the fact that the guilty pleas by Friedman, Udell and Goldenheim included no admissions that they did anything wrong -- or even knew of wrongdoing by other company officials. Rather, the charges hold them responsible simply because of their positions as top company executives. In the flurry of court filings generated by Jones' list of questions, prosecutors also defended their decision not to seek incarceration. The misdemeanor charges to which the executives pleaded guilty carry up to one year in jail; the company pleaded guilty to a felony charge. Such charges are rarely used in the misbranding of pharmaceuticals, the government stated, and the negotiated plea agreements will 'serve as a strong warning' to other drug companies. In addition to raising questions about jail time, Jones also requested detailed information on Purdue's financial holdings. Some critics have said the monetary penalty to be paid by the company represents just a small fraction of its OxyContin profits. But according to federal prosecutors, the $634.5 million in fines accounts for about 90 percent of the company's profits from the time the drug went on the market in 1996 until 2001. The fine is the country's third largest to be assessed against a pharmaceutical company, according to the U.S. Justice Department's Office of Consumer Litigation."


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