Updated June 26, 2018 09:04:49AmerisourceBergen, New Jersey-based Purdue Pharma Inc. (PROP) will sell stock to shareholders in a $1,2 billion cash settlement with the U.S. Justice Department over a program designed to help protect the nation’s most vulnerable.
The deal comes as the Justice Department continues to investigate allegations that pharmaceutical companies misled the public on the efficacy of new medicines and the potential risks of new drugs.
In a statement, Purdue said it has entered into a definitive agreement with the Justice Dept. “to resolve the DOJ’s ongoing investigation into the company’s conduct” and that it expects to complete the transaction within six months.
The settlement resolves a lawsuit brought by the U: Justice Department and 21 states and Puerto Rico, which alleged that Purdue Pharma misstated the effectiveness of a new drug to investors and the U, and misrepresented how the company planned to market its drugs.
Purdue said the settlement will resolve claims that the company engaged in deceptive conduct and failed to properly disclose information regarding the efficacy and risks of its medicines.
The Justice Department said in its complaint that Purdue had misled the government about its plans for the use of a drug called pembrolizumab.
The drug is designed to treat a rare and fatal form of leukaemia and is approved by the Food and Drug Administration to treat about one-quarter of the cases in the United States, and a number of other countries.
Pebrolizums main ingredient, voriconazole, is also an FDA-approved drug for treating cancer, and the company also sold voridacaine, another drug approved for the treatment of rare forms of cancer.
But the DOJ said in a statement on Wednesday that “Purdue did not inform investors about the efficacy, safety or risks of the drug when it marketed it.
This omission was intentional, and Purdue had no reason to believe that its marketing materials would not accurately reflect the results of its own research.”
The Justice Dept.’s complaint also said that Purdue made false and misleading statements to investors about how it planned to conduct its research on the drug, including saying that the drug would be available in a clinical trial by the end of 2020.
The drugmaker also did not properly disclose the potential harm of a second dose of the therapy, according to the complaint.
In September, the Justice Departments civil antitrust division sued Purdue in federal court, claiming the company had violated antitrust laws by making false and unsubstantiated claims about the potential effectiveness of its drugs and other drug products.
The department also alleged that the Purdue company’s failure to disclose those potential harms resulted in substantial market harm to the drug company.
The lawsuit said the company was in violation of the Federal Trade Commission Act, which prohibits unfair or deceptive acts or practices.
Perez also was involved in a separate antitrust case against Purdue in October.