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Purdue Pharma pleaded guilty yesterday to criminal charges that it misled the federal government about sales of its blockbuster painkiller OxyContin, the prescription opioid that helped fuel a national addiction crisis, the New York Times reported. The admission brought a formal end to an extensive federal investigation that led to a multibillion-dollar settlement between the company and the Justice Department. “The abuse and diversion of prescription opioids has contributed to a national tragedy of addiction and deaths,” Jeffrey A. Rosen, the deputy attorney general, said in a statement. “Today’s convictions underscore the department’s commitment to its multipronged strategy for defeating the opioid crisis.” Purdue’s chairman, Steve Miller, acknowledged in a remotely conducted hearing in federal court in New Jersey that in order to meet sales goals, the company told the Drug Enforcement Administration that it had created a program to prevent OxyContin from being sold on the black market, even though it was marketing the drug to more than 100 doctors suspected of illegally prescribing OxyContin. Purdue also pleaded guilty to paying illegal kickbacks to doctors who prescribed OxyContin and to an electronic health records company, Practice Fusion, for targeting physicians with alerts that were intended to increase opioid prescriptions. Practice Fusion has paid $145 million in fines for taking those kickbacks. The company agreed last month to plead guilty to criminal charges and face criminal and civil penalties of about $8.3 billion as part of the settlement with the Justice Department. A federal bankruptcy judge in New York approved the deal last week. The settlement included $3.54 billion in criminal fines and $2 billion in criminal forfeiture of profits. The department said they were the largest financial penalties levied against a pharmaceutical manufacturer.

States suing Purdue Pharma LP over the marketing of its OxyContin painkiller are demanding access to confidential documents as part of a probe into whether some members of the billionaire Sackler family engaged in misconduct when they managed the opioid maker, Bloomberg News reported. More than 20 states said federal prosecutors’ claims tied to a $225 million accord unveiled last month provide a “substantial reason” to believe some of the Sacklers “committed crimes in operating Purdue and secreting its assets,” according to a bankruptcy filing Wednesday. The family members deny the allegations. Those states want U.S. Bankruptcy Judge Robert Drain to force the Sacklers to hand over files they claim are confidential as part of an investigation into whether shifts of “billions of dollars out of Purdue” amounted to fraudulent transfers, the filing shows. Judge Drain signed off on an $8.3 billion settlement between Purdue and the U.S. government last week. The states point to the U.S. government’s assertion in settlement documents that Sackler family members transferred funds out of Purdue “with the intent to hinder future creditors and/or were otherwise voidable as fraudulent transfers,” according to court filings. Jim Boffetti, an assistant attorney general in New Hampshire who is overseeing the office’s opioid litigation, said his state is among those who want access to Purdue’s confidential documents about the fund transfers.

Bankruptcy lawyers cleaning up after the collapse of Philadelphia’s historic Hahnemann University Hospital are seeking help from a judge in getting answers from affiliates of Joel Freedman, the California investor who controlled the hospital, about real-estate transactions, WSJ Pro Bankruptcy reported. Freedman led the 2018 buyout of Hahnemann and its sister institution, St. Christopher’s Hospital for Children. By mid-2019, he was wrangling with Pennsylvania health authorities over plans to shut down a hospital that anchored the city’s services to the poor and homeless, as well trauma victims. Now he is being pressed for documents in bankruptcy court where Hahnemann and St. Christopher’s wound up last year, out of money and looking for buyers. Creditors have mounted “a total assault on our attorney-client privilege,” Edward Moss, lawyer for Freedman’s affiliates, said at a Friday court hearing on the dispute over documents.

Mallinckrodt PLC has gained wider support for its proposed $1.6 billion settlement of thousands of lawsuits that accuse the bankrupt drugmaker of helping fuel the opioid crisis, reaching agreement with more than a thousand U.S. counties, cities and tribes, WSJ Pro Bankruptcy reported. The proposed restructuring deal covers municipalities in dozens of states, among them Texas, West Virginia and Pennsylvania, according to papers filed Saturday in the U.S. Bankruptcy Court in Wilmington, Del., and builds on existing support from territories, state authorities and the holders of most of Mallinckrodt’s unsecured bond debt. The settlement of opioid litigation and the billions of dollars in potential damages is key to the company’s planned chapter 11 restructuring. Mallinckrodt Chief Transformation Officer Stephen Welch testified during a court hearing yesterday that the company is facing more than 3,000 opioid-related lawsuits. Welch has helped lead Mallinckrodt’s restructuring efforts. Mallinckrodt is also facing additional litigation related to its Acthar Gel drug used to treat lupus, multiple sclerosis and other ailments. Mallinckrodt officials yesterday argued to extend a legal shield freezing the Acthar lawsuits while it pursues its chapter 11 restructuring.

California, New York and other states are revolting against the Justice Department’s proposed settlement with OxyContin maker Purdue Pharma LP, which is accused of helping fuel the opioid crisis, WSJ Pro reported. The proposed pact comes up for approval next week in bankruptcy court, where Purdue sought refuge from litigation. But a growing chorus of critics is warning the proposal would short-circuit broader talks about how to use Purdue’s assets to address the addiction epidemic. Purdue is set to plead guilty to three felony counts including conspiracy to defraud the U.S. and conspiracy to violate federal anti-kickback laws, as part of the settlement. The pact also calls for Purdue to transform itself into a company to be run for the benefit of the public. States said that the settlement, if approved, ties the hands of other creditors that would prefer to sell Purdue. Purdue was hit with an avalanche of lawsuits accusing it of pushing a highly addictive drug into vulnerable and unwary markets. It has denied wrongdoing and filed for chapter 11 last year to get breathing space and open talks about how to address demands for damages. Some Democratic lawmakers have also warned Purdue’s proposed deal with the Justice Department is bad for the public, but this week bankruptcy experts, dozens of states and lawyers for individuals with addiction-related claims against Purdue weighed in against it. Critics are urging delay so the deal doesn’t crowd out other alternatives for state and tribal governments and others that have been contending with the legal, social and medical burden of opioid addiction. The Justice Department negotiated separately from the general bankruptcy talks, critics said.

Pfizer CEO Albert Bourla sold $5.6 million of company stock as shares soared 15 percent on the news that a late-stage trial found the company’s COVID-19 vaccine to be 90 percent effective, Fox Business reported. Bourla sold 132,508 Pfizer shares at a price of $41.94 apiece through a scheduled Rule 10b5-1 trading plan adopted on Aug. 19, one day after the company announced positive results from a Phase 1 study. He owned 81,812 Pfizer shares following the planned sale. "The sale of these shares is part of Dr. Bourla's personal financial planning and a pre-established (10b5-1) plan, which allows, under SEC rules, major shareholders and insiders of exchange-listed corporations to trade a predetermined number of shares at a predetermined time," a Pfizer spokesperson said. Pfizer and German partner BioNTech on Aug. 19 said the experimental vaccine could receive regulatory review as soon as October. In an open letter, Bourla wrote Pfizer could potentially apply for emergency authorization use in the third week of November.  Bourla wasn’t the only Pfizer executive to sell stock. Executive Vice President Sally Susman, through her own Rule 10b5-1 trading plan, cashed out 43,662 shares at a price of $41.94 apiece, netting her $1.8 million. Susman still owns 108,804 shares. Pfizer and BioNTech's vaccine, which is on track to be the first for COVID-19 to receive regulatory approval, could be administered to most Americans by the middle of 2021. The companies could produce 50 million doses by the end of this year and as many as 1.3 billion doses next year.