Opioid Maker Endo Health Solutions to Pay $1.1B, Forfeit $450M

It's the second-largest criminal financial penalty levied against a drug maker.

The now-reorganized Endo Health Solutions Inc. has agreed to pay $1.086 billion in criminal fines and $450 million in criminal forfeitures after pleading guilty to one misdemeanor charge related to the intentional misbranding of its opioid medication Opana ER with INTAC, the U.S. Department of Justice says.

EHSI pled guilty on April 18 to one count of introducing misbranded drugs into interstate commerce. The drugmaker admitted that from April 2012 through May 2013, its sales reps marketed Opana ER to physicians by baselessly claiming that the opioid was tamper- and crush-resistant and thus purportedly deterred abuse. In some cases the sales reps used hammers to strike non-medicated sample pills.

In addition, EHSI admitted it 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 federal Food, Drug, and Cosmetic Act.

EHSI stopped selling Opana ER in 2017. The drugmaker was shut down during the bankruptcy process and not allowed to continue its prior form when the company emerged on April 23. The EHSI affiliates that come out of the bankruptcy process can no longer sell or market opioids and must make public millions of documents relating to EHSI's role in the opioid crisis.

EHSI issued a statement calling the agreement "an important step in our settlement with the DOJ."

"The company has made important changes since the historical conduct of certain former sales representatives that took place from 2012 to 2013. We remain committed to operating with integrity and maintaining a culture of compliance and ethics," EHSI says.

EHSI says the settlement with the federal government included $200 million when it emerged from bankruptcy in April, "which fully satisfied the criminal fine, the civil false claims act settlement agreement, and all of the IRS tax claims, with possible additional payments up to a maximum of $100 million to be paid over five years if certain financial metrics are met."

The largest criminal penalty imposed in the sweeping opioid legal actions was levied against Reckitt Benckiser Group plc, which in 2019 agreed to pay $1.4 billion to resolve its potential criminal and civil liability for its role in marketing of the opioid addiction treatment drug Suboxone.

The EHSI settlement is a component of the broader case resolving all monetary claims held by the federal government against EHSI's new corporate entities. The new company has also funded trusts for opioid-related claims that will pay more than $450 million to state, municipal and tribal governments for opioid addiction treatment programs.

DOJ is crediting up to $450 million of these payments against the forfeiture amount.

"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," Drug Enforcement Administration Administrator Anne Milgram says. "By intentionally misrepresenting opioid medications, EHSI prioritized profits over the health and well-being of the American people. (This) settlement reflects DEA's commitment to keep Americans safe and holding companies like EHSI accountable."