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Report: Drugmaker Knew OxyContin Was Being Distributed Illegally, Did Nothing

Mike Adams

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OxyContin, narcotics, painkillers

It appears that Purdue Pharma may have been privy to the black market distribution of more than one million OxyContin pills and other underhanded dealings within the illegal drug trade—long before the company ever agreed to cooperate with law enforcement agencies.

An investigative report from the Los Angeles Times recently uncovered a series of emails and personal testimony from key officials once employed with the drug manufacture, which indicates that Purdue had evidence that the powerful prescription narcotic was being slung across the nation by the Armenian mob, the Crips and other criminal organizations, but it never took any action to cut off the supply or report its findings to the U.S Drug Enforcement Administration.

According to court and law enforcement documents, Purdue was never in the dark about how crooked doctors and pharmacies were conspiring with organized crime rings to traffic OxyContin across the United States. Evidence collected by way of pharmacy orders, field reports and internal surveillance operations shows that OxyContin was being illegally trafficked from Los Angeles to as far east as New Hampshire, for nearly two years, without prompting the company to step in with a tighter leash.

Federal law requires drug manufacturers to report suspicious orders to the DEA, but none of the evidence Purdue had in its possession about a shady California clinic doing business under the name “Lake Medical” was ever shared with the governmental drug agency during a time when it could have been beneficial to the case. Instead, Purdue took minimal interest in the staggering surge of OxyContin orders, even with some distributors reporting an increase of nearly 1400 percent within a year’s time.

But Phil Strassburger, general counsel for the drug maker, claims that Purdue “at all times complied with the law,” and perhaps did not jump the gun on sharing evidence with authorities because “it would be irresponsible to direct every single anecdotal and often unconfirmed claim of potential misprescribing to these organizations.”

Although Purdue claims it did reduce the supply of OxyContin to distributors who had been red flagged for corruptive practices, the company argues that it simply could not get too over-zealous about castrating the flow of the addictive painkiller because such a drastic action may have interfered with getting the drug into the hands of legitimate patients.

However, there doesn’t seem to be any question that the drug maker was on a mission to bamboozle the market in an effort to capitalize on what has now become American’s best-selling painkiller.

Long before the Lake Medical debacle hit the fan, Purdue was forced to pay $635 million for the misbranding of OxyContin in an attempt to mislead physicians about the highly addictive nature of the drug—a drop in the bucket compared to the more than $31 billion the company has generated from OxyContin sales. Three of the company’s leading executives plead guilty to charges in federal court, which prompted Purdue to establish an internal security team that was hired to ensure that potentially dangerous drugs were not being sold for use outside of their medicinal function.

Yet, California state prescribing records show that Dr. Eleanor Santiago, the primary physician at Lake Medical, went from prescribing nearly 34,000 OxyContin pills in December 2008 to almost 69,000 by September 2009. And while this increase eventually caused a Purdue sales manager to launch an investigation, the company’s legal team simply opted to add Santiago to a confidential list of reckless physicians (known as “Region Zero”) rather than file a report with the DEA.

Only eight percent of the doctors that ended up on Purdue’s Region Zero roster were ever reported to law enforcement, according to the Times’ investigation.

It was eventually discovered that the folks at Lake Medical were running a clever scam using homeless people to get their hands on mass amounts of 80-milligram OxyContin—which, at the time, could be snorted or injected by the user. Someone from the clinic would hit skid row and pay “as little as $25” per person for desperate people to come into the office, fill out the necessary forms and collect a prescription for the painkiller. At that point, these people would be driven to a pharmacy where a chaperone from the clinic would pay for the prescriptions in cash. The pills would then make their way back to Lake Medical to be packaged for sale on the black market.

Due to several complaints from local pharmacists, Purdue had evidence that homeless people were being used to run this scam, but the company did nothing. In fact, once these complaints made their way through to the company’s attorneys, they never received a response.

Even after Purdue’s own employees witnessed questionable practices, first hand, the company did not take any action to stop the flow of OxyContin. Jack Crowley, Purdue’s former executive director of Controlled Substances Act compliance, told the Times that in a couple of instances he watched homeless and young people get prescriptions filled and then hand the product over to a secondary party, which he believed to be drug dealers.

“It was terrible,” he said. “It was just a drug distribution operation.”

The Times report indicates that most pharmacists did not bother calling the DEA over the large amount of cash transactions for OxyContin because they did not want to risk an audit. And Purdue was not sharing any of its knowledge about these questionable practices with the DEA because it was not legally required to do so. In a statement provided by Purdue attorney Phil Strassburger, it seems the company got away with sandbagging the DEA because while it is “required to monitor and report suspicious orders… Purdue does not ship prescription products directly to retail pharmacies; it sells only to authorized wholesalers, who maintain their own order monitoring programs.” Therefore, any underhanded dealings in the retail sector are not the drug company’s immediate responsibility.

By the time a team of state and federal law enforcement agencies and prosecutors collected enough evidence to finally bring down the Lake Medical operation, Purdue was finally ready to give up a few names. However, all of the information the drug company turned over to investigators was old news. It wasn’t until two years later when Purdue submitted internal documents regarding several questionable operations in the Southern California area that federal prosecutors were able to pursue additional cases.

“Purdue was proud to assist federal authorities in their prosecution of that criminal drug ring, which led to several convictions,” the company said in a statement.

Interestingly, the federal government has not actually accused Purdue of any wrongdoing. The company has made adjustments to the way OxyContin is manufactured, making it difficult for the drug to be snorted or injected, and therefore less appealing to the black market. Still, no criminal charges are currently being pursued against company officials for knowingly contributing to illegal drug operations.

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