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A New Purdue Pharma Settlement for OxyContin Injuries Is In the Works

Purdue Pharma, the well-known maker of OxyContin, the time-released painkiller that is considered a major factor in fueling the nation’s opioid crisis, and its founding owners, the Sackler family, have agreed to pay up to $7.4 billion to settle claims regarding its role in the drug epidemic. However, with the offer comes a new contingency – claimants would have to set aside $800 million for the Sackler family to use as a legal defense fund for their litigation in future opioid lawsuits.

Last summer, the U.S. Supreme Court blocked a different opioid settlement that would have moved forward fiscal support to victims and communities impacted by the opioid crisis, and for their part, the Sacklers had pledged to pay out $6 billion. However, within that settlement, there was a different contingency. The family stipulated that they receive protection from future civil lawsuits, similar to bankruptcy protection.

OxyContin bottles on a counter in a pharmacy

While a New York court had initially approved the settlement, it was blocked from moving forward after the U.S. Trustee Program, a division of the U.S. Justice Department, requested that the highest court review the settlement. Although Purdue had filed for bankruptcy protection, the family members involved in marketing and selling OxyContin had not.

Justice Neil Gorsuch, writing for most of the Supreme Court last June on its decision, stated: “Nothing in present law authorizes the Sackler discharge.”

While the Sackler’s attorneys have given up seeking complete protection, the new contingency in the 2025 agreement means the cost of any future opioid litigation against the Sacklers would be paid for not by the personal accounts of family members but out of the settlement fund (until it runs out). 

The New Opioid Settlement Breakdown

The agreement includes $6.5 billion from the Sackler family, a $500 million boost from their 2023 offer, and the remaining $897 million from the company, which filed Chapter 11 bankruptcy in 2019. If the settlement is approved, the money will be used in large part to support opioid addiction treatment, prevention, and recovery programs across the country.

Fifteen state attorney generals helped negotiate the new deal including those from New York, Florida, Connecticut, Massachusetts, Tennessee, California, Colorado, Illinois, Delaware, Pennsylvania, Oregon, Texas, Vermont, Virginia, and West Virginia.

Since Purdue Pharma introduced OxyContin to the market, millions of Americans have struggled with opioid addiction, with many of those cases proving fatal. At the same time, the Sacklers have been forced to handle constant litigation, with Purdue Pharma pleading guilty to federal criminal charges of deceptive marketing, not once but twice, in 2007 and 2020. However, the Sackler family members maintained they were unaware of wrongdoing and despite the guilty plea for their company the family has been able to hold onto much of its wealth and will continue to do so. According to some estimates, because of profits made by Purdue over the years, the Sacklers’ worth will be billions more than they’d contribute to the new settlement.

Reaction by State Leaders to the New Agreement

William Tong is the attorney general for Connecticut, the state where Purdue Pharma is headquartered. Soon after the agreement was reached, Tong released a statement explaining his next step was to “seek sign-on from the remaining states and municipalities who have sued, as well as approval from both bankruptcy and state courts.”

In the release, he had harsh words for the Sacklers, describing the family as “cruel billionaires who believed they were above the law,” and that the agreement serves as a signal to “the end of the Sacklers’ control of Purdue” while disallowing them from selling opioids in the United States.

New York’s state attorney general, Letitia James, also worked to bring forward an agreement and while she described the settlement as “a massive influx of funds’’ that can bring resources to communities in need, she also had harsh words for the Sacklers. 

James said that “no amount of money will ever fully repair the damage they caused.’’

A court order blocking lawsuits against Sackler family members is set to expire on January 31, but attorneys are asking a U.S. Bankruptcy Court judge to keep it in place through February for the agreement to be finalized.

If the $7.4 billion settlement is approved by all parties, it would represent the country’s largest opioid-related settlement with individuals to date.

Members of the Sackler family included in the settlement in principle include the eight heirs of Purdue founders Raymond and Mortimer Sackler who served on the Board of Purdue: Richard, Kathe, Mortimer Jr., Ilene, David, and Theresa Sackler; and the estates of Jonathan and Beverly Sackler. In addition, their associated trusts, advisers, and most of their children and heirs are also included.