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Purdue Pharma, Sacklers reach $6 billion deal with state attorneys general

The headquarters of Purdue Pharma LP, the maker of the painkiller OxyContin, are seen in Stamford, Conn.
Timothy A. Clary
/
AFP via Getty Images
The headquarters of Purdue Pharma LP, the maker of the painkiller OxyContin, are seen in Stamford, Conn.

Nine state attorneys general have agreed to drop their objection to a deal granting immunity from opioid lawsuits to members of the Sackler family who own Purdue Pharma, the maker of OxyContin.

In exchange, the family has agreed to increase the amount it pays from personal holdings from roughly $4.5 billion under a previous settlement to $6 billion.

Washington state Attorney General Robert Ferguson described the terms of the new settlement as a victory.

"Rather than join the majority of states in settlement, Washington chose to lead the fight against the Sacklers and Purdue," Ferguson said in a statement.

"As a result, we won more than $100 million for Washington state to address the opioid epidemic, and more than $1 billion for states, cities and tribes across the country."

The prior deal was overturned by a federal judge in Manhattan last December after some states and the Justice Department filed an appeal.

States demanding more money from the Sacklers — California, Connecticut, Delaware, Maryland, New Hampshire, Oregon, Vermont and Washington — have among the highest overdose death rates in the country.

Sacklers voice "regret" but deny wrongdoing

In a statement, members of various branches of the Sackler family again denied any wrongdoing and described the settlement as one that will "allow very substantial additional resources to reach people and communities in need."

"While the families have acted lawfully in all respects, they sincerely regret that OxyContin, a prescription medicine that continues to help people suffering from chronic pain, unexpectedly became part of an opioid crisis that has brought grief and loss to far too many families and communities."

Critics, including many of the state attorneys general who approved this deal, have long accused members of the Sackler family of aggressively marketing opioids in ways that contributed to soaring rates of addiction and overdoses.

Purdue Pharma has admitted criminal wrongdoing in two separate plea agreements with the U.S. Justice Department.

Though the Sacklers themselves have never been charged with any personal wrongdoing, they agreed to pay $225 million to the Department of Justice as part of a separate settlement in 2020.

The deal isn't final just yet

This new deal will now require approval by U.S. Bankruptcy Judge Robert Drain, who has presided over the case. He has signaled his strong support for these talks and to a deal that would avoid years of costly litigation.

The additional $1 billion would be directed to programs designed to tackle the opioid crisis.

Most of the total funds would still be divided among state, local and tribal governments, including the states and Washington, D.C. that opposed the original settlement.

One controversial provision of the deal remains: as with the prior settlement, the Sacklers would be protected from current and future lawsuits related to OxyContin and other Purdue pain medications.

In addition to holding out for a larger contribution, critics said forcing states to give up their right to sue the Sacklers represented an unconstitutional overreach by the bankruptcy court.

A hearing on the case before the Second Circuit Court of Appeals is scheduled for April, but it is expected to be canceled if all the parties withdraw their objections.

This settlement could cap a contentious bankruptcy proceeding that started in September 2019. The case played out against the backdrop of surging drug overdose deaths, involving prescription painkillers and the synthetic opioid fentanyl.

The settlement doesn't give the Sackler family protection from criminal lawsuits

Some advocates for people who use drugs are angry at the time and money spent on this case rather than on addiction and overdose prevention. Drug overdose deaths rose to a record high of more than 100,000 people last year.

Others are angry that Sackler family members are not being forced to give up more of their wealth. Court filings show the family took in $10 billion in profits from OxyContin and could recoup much of what they lose in this settlement.

While the Sacklers have never faced criminal charges — and have denied any wrongdoing – their alleged role pushing opioid sales have brought a growing public backlash.

Museums, universities and other institutions around the world have stripped the Sackler name from buildings and programs.

The Sackler-Purdue bankruptcy deal is one of several settlements that are expected to provide state and local governments with funds to help reduce overdoses and deaths.

They fall far short of the more than $1 trillion the opioid crisis costs the U.S. every year, according to the Centers for Disease and Control.

While this deal would block civil lawsuits against the Sacklers and much of their remaining financial empire, it would not prevent the government from pursuing criminal charges against members of the family if the government decided to do that.

Purdue Pharma has pleaded guilty to federal criminal charges twice, in 2007 and in 2020, based on deceptive marketing that downplayed the risk of becoming addicted to OxyContin. Sackler family members maintain they were unaware of wrongdoing by executives at the company.

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Brian Mann
Martha Bebinger