Mallinckrodt LLC, a major manufacturer of oxycodone, agreed to a $35 million settlement with the U.S. Department of Justice and the Drug Enforcement Administration (DEA) for alleged violations of the Controlled Substances Act, according to the agencies.

The company was accused of failing “to meet its obligation to detect and notify” the agencies of suspicious orders for controlled substances and to correctly maintain records requirements at its plant in Hobart, N.Y. The agencies also claimed that the pharmaceutical company supplied “an increasingly excessive quantity of oxycodone pills” to distributors, who sold them to pharmacies and pain clinics, without alerting the DEA.

 “In the midst of one of the worst drug abuse crises in American history, the Department of Justice has the responsibility to ensure that our drug laws are being enforced and to protect the American people,” Attorney General Jeff Sessions said in a statement. “Part of that mission is holding drug manufacturers accountable for their actions.”

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The Dublin-based pharmaceutical company denied that it violated those regulations and did not admit guilt in the case. The company stated it settled only to avoid the complications of a drawn-out lawsuit and to quickly move past the allegations.

"While Mallinckrodt disagreed with the U.S. government’s allegations, we chose to resolve the legacy matter in order to eliminate the uncertainty, distraction and expense of litigation and to allow the company to focus on meeting the important needs of its patients and customers," Michael-Bryant Hicks, general counsel for Mallinckrodt, said.

Mallinckrodt also agreed to analyze data it collects on orders to help identify any future sales of suspicious quantities.
The Justice Department stated that it believes this agreement is a sign that Mallinckrodt “is becoming part of the solution to this public health epidemic.”

—Michael DePeau-Wilson

Based on press releases from the U.S. Department of Justice and Mallinckrodt LLC.