States Reach $7.4 Billion Settlement with Purdue Pharma

Purdue Pharma has agreed to a $7.4 billion settlement with 55 U.S. states and territories over allegations that it fueled the opioid crisis through aggressive marketing of its product, OxyContin. The settlement, announced on Monday (June 16), will end the Sackler family's ownership of Purdue Pharma and provide funds to state and local governments, individuals, and Native American tribes.

The deal, filed with a federal bankruptcy court in March, comes after extensive negotiations with state attorneys general and other stakeholders. If approved, payouts will occur over the next 15 years. New York Attorney General Letitia James stated that the plan will hold the Sackler family accountable for their role in the opioid epidemic. The Sacklers are expected to contribute approximately $6.5 billion to the settlement.

A significant change from previous agreements allows individuals to pursue civil lawsuits against the Sacklers if they do not opt into the releases contained in the plan. Purdue Pharma described the approval of the reorganization plan as a critical step in providing compensation to victims and addressing the opioid crisis. Despite the settlement, the Sackler family maintains they committed no wrongdoing.

While the deal has been praised by attorneys involved in the litigation, some, like addiction recovery advocate Ryan Hampton, feel it falls short of adequately compensating victims. Hampton criticized the allocation of only $850 million for direct victims, estimating his payout at about $3,500.

The settlement still requires approval from a federal bankruptcy court, but experts believe it is likely to be accepted. If finalized, this agreement will contribute to over $50 billion in opioid-related payouts by companies involved in the manufacture, distribution, and sale of opioid painkillers during the crisis.