Judge conditionally approves Purdue Pharma opioid settlement
A federal bankruptcy judge gave conditional approval Wednesday to a sweeping settlement that will remove the Sackler family from ownership of OxyContin maker Purdue Pharma and devote potentially $10 billion to fighting the opioid crisis that has killed a half-million Americans over the past two decades.
If it withstands appeals, the deal will resolve a mountain of 3,000 lawsuits from state and local governments, Native American tribes, unions and others that accuse the company of helping to spark the overdose epidemic by aggressively marketing the prescription painkiller.
Under the settlement, the Sacklers will have to get out of the opioid business altogether and contribute $4.5 billion. But they will be shielded from any future lawsuits over opioids.
The drugmaker itself will be reorganized into a new charity-oriented company with a board appointed by public officials and will funnel its profitsinto government-led efforts to prevent and treat addiction.
Also, the settlement sets up a compensation fund that will pay some victims of drugs an expected $3,500 to $48,000 each.
After an all-day hearing in which he analyzed the plan’s pros and cons for a nonstop 6 1/2 hours, U.S. Bankruptcy Judge Robert Drain said he would approve it as long as two relatively small changes were made. If so, he said, he will formally enter the decision on Thursday.
He said that while he does not have “fondness for the Sacklers or sympathy for them,” collecting money from them through lawsuits instead of a settlement would be complicated.
The deal comes nearly two years after the Stamford, Connecticut-based company filed for bankruptcy under the weight of the lawsuits.
Under the settlement, the Sacklers were not given immunity from criminal charges, though there have been no indications they will face any.
State and local governments came to support the plan overwhelmingly, if grudgingly in many cases. But nine states and others had opposed it, largely because of the protections granted to the family.
The attorneys general of Connecticut, the District of Columbia and Washington state immediately announced they will either appeal the ruling or explore the possibility of doing so.
The Sacklers “should not be allowed to manipulate bankruptcy laws to evade justice and protect their blood money,” Connecticut’s William Tong said.
Some families who lost loved ones to drugs also came out against the settlement, including Ed Bisch, of Westampton, New Jersey, whose 18-year-old son died of an overdose nearly 20 years ago. “The Sacklers are buying their immunity,” he said