Purdue Pharma and members of the Sackler family, which owns the company, have agreed in principle to pay a $7.4 billion settlement to resolve thousands of lawsuits over the company's role in the opioid crisis, the state attorney general said. It was announced on Thursday.
The proposed settlement is an additional $1.4 billion in principle than the previous one, due to a provision in the agreement that grants immunity to some members of the wealthy Sackler family from civil lawsuits in exchange for $6 billion. It was invalidated by the Supreme Court in June last year.
The provision drew opposition because Purdue filed for bankruptcy protection, but the Sacklers themselves did not.
New York Attorney General Letitia James (D) said the overall value of the settlement could be up to $7.4 billion, including nearly $900 million from Purdue.
The deal was being negotiated by a bipartisan team and must be approved by the court, with lawyers saying they should iron out further details in the coming weeks. It is expected to take effect towards the end of the year.
The settlement does not provide broad immunity to the Sacklers, but only to those entities that agree to the settlement.
The settlement ends the Sacklers' control of Purdue and their ability to sell opioids in the United States. Over the next 15 years, it will provide funding directly to communities across the country to support opioid addiction treatment, prevention, and recovery programs.
If approved, it would be the largest settlement ever with individuals responsible for contributing to the deadly opioid epidemic. Local, state, and Native American tribal governments have filed thousands of lawsuits holding manufacturers, distributors, and pharmacies accountable.
The settlement will provide funds to participating states, local governments, affected individuals, and other parties that previously sued the Sacklers or Purdue.
A significant portion of the settlement will be distributed over the first three years, with an initial payment of $1.5 billion, followed by $500 million in one year, another $500 million in two years, and $400 million in three years. Mr. James said that Said.
Additionally, the Sacklers will no longer be able to dominate Purdue. A board of directors elected by participating countries in consultation with other creditors will decide the future of the company. Purdue will continue to be monitored by wardens and will be prohibited from lobbying or selling opioids under the settlement.
Purdue is the company that manufactured and sold OxyContin, a powerful prescription painkiller that is abused and addicted to by Americans. The company was accused of illegally marketing OxyContin, exaggerating its benefits while intentionally downplaying its risks, and encouraging doctors to overprescribe it.
“We are very pleased to have reached a new agreement that will provide billions of dollars to compensate victims, alleviate the opioid crisis, and provide lifesaving treatments and overdose rescue drugs,” Purdue said in a statement. I think so.'' “We have been working diligently with our creditors for many months and are now focused on finalizing the details of our new reorganization plan and look forward to filing it in bankruptcy court. ”
This transaction has not been accepted by all creditors. In addition to New York, 14 states participating in the negotiations have signed on, including Florida, Connecticut, Massachusetts, Tennessee, California, and West Virginia.