Purdue Pharma settled a nationwide lawsuit Thursday for its role in the opioid epidemic. Members of the Sackler families, who are the owners of the company, increased their contribution to $6 billion. It was done to stem the tide of legal action against OxyContin maker Purdue Pharma.
Following an earlier agreement that was challenged by 8 states and the District of Columbia, this deal is now in effect. The Sacklers agreed to the terms after they paid more and offered other conditions. They agreed to protect the family from civil lawsuits.
Over time, it could amount to more than $10 million. This plan requires members of Sackler’s family to relinquish control over the Stamford company. Profits will be used to combat the crisis. The deal would not shield members of the family from criminal charges, although there’s no indication any are forthcoming.
Sackler’s family did not offer an unequivocal apology. However, they expressed their regret for the death of OxyContin. This painkiller was known to be manipulable to provide quick highs. Purdue Pharma promoted the use of OxyContin for pain conditions for which other doctors had previously shied away.
“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,” said the statement from the Sackler family.
The settlement provides victims with a platform to discuss some Sacklers in court via videoconference. That’s something they have not been able to do previously in a public setting.
Learn More: Opioid Epidemic: Older Americans are the neglected victims
This settlement was outlined in the U.S. Bankruptcy Court report in White Plains (New York) and must be approved. It was hammered out with attorneys general from the eight states—California, Connecticut, Delaware, Maryland, Oregon, Rhode Island, Vermont and Washington—and D.C. who had opposed the earlier one, arguing that it did not properly hold Sackler family members accountable.
Several parents whose children became addicted to opioids said they were ambivalent—glad that more money will be available for addiction treatment, but upset that the Sacklers will remain wealthy and escape more accountability.
Connecticut’s Paige Niver, whose daughter became addicted following a bicycle accident when she was 14 and remains in recovery about 13 years later, said she didn’t want other families to endure what hers did.
“As a mother, I did what the doctor told me to do and I just kept giving them to her. And when they were starting to have kind of a lesser effect, they say, ‘Oh, then you need to give her more.’ And that’s exactly what I did,” she said at a news conference Thursday with her state’s attorney general.
“I never thought I’d see any justice for it, so the money will do so much good—fund as much treatment and prevention as possible,” Niver said.
Ed Bisch was the father of an 18-year-old boy who overdosed 20 years ago. He is happy that states made it more affordable for Sackler relatives. Still, he called the settlement “a horrible deal” because so many parents who buried loved ones won’t see money, while the Sacklers retain their wealth.
“Guess what? They still made billions and billions of dollars,” said Bisch, of Westampton, New Jersey. “Without any jail time, where is the deterrent? We’ve lost two generations to their greed.”
The $750million fund is shared between individual victims and their families. It’s a crucial provision in opioid settlements that doesn’t exist elsewhere. The fund could be used by approximately 149,000 individuals who made claims before the deadline and may qualify for shares.
The new plan will keep this amount unchanged, however, the states will have the ability to make additional money to pay victims.
Learn More: The Opioid Diaries
Other new provisions include an agreement from Sackler family members that they won’t fight when institutions attempt to take their names off buildings funded by the family’s support. Further company documents will also be public.
With the condition that most of it go to states, local governments, Native American tribals, and hospitals, the rest must be used to combat the opioid crisis which has caused more than 500,000 deaths over the past 20 years in the U.S.
“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 Pharma said in a statement issued separately from the family’s. “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.”
Kentucky and Oklahoma won’t be part of this deal as they had already reached agreements with Purdue.
Purdue is the company that invented time-release prescription painkillers and has been the most prominent of all the companies involved in lawsuits. Two times, it pleaded guilty in criminal cases related to OxyContin business practices.
The latest announcement follows another landmark settlement late last week, when drugmaker Johnson & Johnson and three distributors finalized a settlement that will send $26 billion over time to virtually every state and local governments throughout the U.S.
Two key differences exist between this latest Purdue Settlement and last year’s. The Sacklers’ cash contribution has gone up by at least $1.2 billion, and state attorneys general and the District of Columbia have now agreed.
Once Purdue (which will be renamed Knoa Pharma) emerges from bankruptcy, money should begin flowing. It’s not clear when that will be. Last payment from settlement not due until 2039
The eight US states and D.C. declined to sign up last year. Most of them appealed the decision by the bankruptcy judge.
The nine remaining holdouts were supported by a U.S. judge in December. The judge, Colleen McMahon, rejected the settlement with a finding that bankruptcy judges lack the authority to grant legal protection to people who don’t themselves file for bankruptcy when some parties disagree.
Purdue appealed this decision. If left in place, it could have stopped a common way of reaching settlements for complex, broad lawsuits.
While the general attorneys have now signed up, they will be withdrawing from the legal battle. However, they can still send briefs to the courts asking them not to grant protections to those who are not filing for bankruptcy.
Connecticut Attorney General William Tong has repeatedly said he has felt a “special obligation to be aggressive” in the case because Purdue is headquartered in the state. Although he acknowledged that it was 40 percent more than his previous settlement, he expressed disappointment with Thursday’s final settlement.
“I wanted more. “I still desire more. But I took it as far as I could take it,” he said during a news conference. “If we were to continue, we would do it alone and that is untenable.”
Robert Drain must approve this new agreement. The court could allow appeals related to the earlier version of this plan.
Report by Susan Haigh and Dave Collins, both from Connecticut.