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After CEO pleads guilty, Indivior inks $600M deal to escape opioid marketing accusations

The federal government’s yearslong probe into sales of opioid addiction therapy Suboxone Film has turned out some eye-popping plea deals in recent months. Now, weeks after its former CEO pleaded guilty to federal charges, Suboxone maker Indivior has inked a hefty settlement of its own to stay out of court.

Indivior will shell out $600 million to federal and state authorities over the next seven years after pleading guilty to misleading the Massachusetts Medicaid program about Suboxone’s danger to children to secure formulary coverage, the U.S. Department of Justice (DOJ) said in a release Friday.

The drugmaker will pay $289 million to settle federal and state criminal claims, including closing an indictment from a West Virginia federal grand jury in April 2019. In addition, Indivior will dole out $300 million to close civil claims it violated the False Claims Act in its Suboxone marketing. The company will pay out the settlement in annual installments beginning the week the plea deal is finalized, Indivior said. 

As part of its deal, Indivior Solutions, the company’s opioid subsidiary, will be barred from participating in government healthcare programs. Indivior said that ban would only apply to its subsidiary and would have no “material effect” on the drugmaker’s business with U.S. government payers. 

In a release (PDF), Indivior CEO Mark Crossley said the drugmaker was “pleased” with the settlement and was looking to move past prior allegations. 

“The incident to which the agreement relates occurred well in the past and does not reflect the values Indivior has strived to demonstrate and uphold during our long history of partnering with healthcare providers, policymakers, and communities to fight the opioid crisis,” he said.

Indivior, a former subsidiary of Reckitt Benckiser, not only misled the state of Massachusetts of Suboxone’s addictive dangers but also pumped sales to doctors who prescribed the drug for off-label use, the DOJ said in a release. Reckitt previously agreed to shell out a whopping $1.4 billion to settle its own Suboxone marketing allegations..

Earlier this month, former Indivior CEO Shaun Thaxter pleaded guilty to his role in scheming to secure Medicaid formulary coverage in Massachusetts just one day after stepping down from the company.

Thaxter was replaced by chief financial and operations officer Mark Crossley, who has worked at the company since 2017. Indivior noted (PDF) in a release that Thaxter’s plea did not affect the company as a whole and said the drugmaker was working to resolve the rest of its Suboxone litigation “as expeditiously as possible.”

As part of his plea deal, Thaxter agreed to pay $600,000 in fines and forfeiture and will face up to one year in jail pending a sentencing hearing Sept. 29.

The Indivior settlement mostly closes the book on a long-running saga that has snared more than $2 billion in settlement money.

In October, Reckitt agreed to settle with New York’s attorney general and five other states that claimed its pharma division, spun off in 2014 and rebranded as Indivior, misled doctors on the safety of Suboxone, leading to chronic overprescription of the med.

Reckitt signed one of the largest settlements in pharma history over its Suboxone sales in July 2019, agreeing to shell out $1.4 billion to the feds to end multiple federal probes into its Suboxone scheme.

Reckitt’s settlement only covered allegations dating to the period before Indivior’s 2014 spinoff, Indivior said in a statement.