March 4, 2022 -- Purdue Pharma and the Sackler family, which owns it, have reached a new deal to settle lawsuits that accused them of fueling the opioid addiction epidemic with aggressive sales and marketing of OxyContin and other painkilling drugs.

Under terms of the proposed settlement, Purdue Pharma and the Sacklers would pay $5.5 billion to $6 billion to settle the lawsuits filed by a group of states and the District of Columbia, The New York Times and other media outlets reported.

The money would be used to fund addiction treatment programs across the nation. In a victory for the Sacklers, the agreement would end all civil claims against them over the opioid business, the Times reported. The company is still not admitting civil liability.

“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,” the Sacklers said in a statement attached to the court filing, according to the Times.

Last September, Judge Robert Drain of the U.S. Bankruptcy Court in White Plains, NY, said he was ready to approve a $4.5 billion settlement. A number of defendants appealed, and another federal judge overturned the settlement, setting off a new round of negotiations, according to The Wall Street Journal. Drain and then the Justice Department still have to approve the new agreement for it to go forward.

Connecticut Attorney General William Tong criticized the latest settlement as too small but said he approved it because treatment programs were needed right away.

“This settlement is both significant and insufficient -- constrained by the inadequacies of our federal bankruptcy code,” he said in a statement. “But Connecticut cannot stall this process indefinitely as victims and our sister states await a resolution.”

The Sacklers will lose control of Purdue Pharma, which will be organized into a new company named Knoa Pharma with a board appointed by public officials. Company profits would go toward drug treatment programs.

Another condition of the agreement is that the Sacklers, who have long donated to cultural institutions, agree not to protest if a medical center or art museum votes to remove the Sackler name. That movement is already underway, with the Metropolitan Museum of Art in New York deciding last December to remove the Sackler name from seven exhibition spaces, theJournal reported.

Purdue Pharma came under scrutiny for the way it aggressively marketed OxyContin, an addictive painkilling medication. The CDC says about 500,000 people died from opioid overdoses between 1999 and 2019, with some of those deaths attributed to OxyContin and others to other opioids like heroin and fentanyl and other prescription painkillers.

“We’re pleased with the settlement achieved in mediation, under which all of the additional settlement funds will be used for opioid abatement programs, overdose rescue medicines and victims,” Purdue said in a written statement. “With this mediation result, we continue on track to proceed through the appeals process on an expedited schedule, and we hope to swiftly deliver these resources.”

Show Sources

The New York Times: “Sacklers and Purdue Pharma Reach New Deal With States Over Opioids.”

The Wall Street Journal: “Judge Throws Out Purdue Pharma’s Deal to Shield Sacklers From Opioid Lawsuits,” “Metropolitan Museum of Art to Remove Sackler Name From Exhibition Spaces.”

Office of the Attorney General, Connecticut: “Attorney General Tong Compels Purdue Pharma and Sackler Family to Pay $6 Billion to Victims, Survivors and States.”

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