Purdue Pharma, one of the leading drug manufacturers accused of fueling the opioid crisis in the country, has agreed to pay approximately $4.28billion to resolve pending opioid lawsuits.
The payment from the extended Sackler family is part of a comprehensive restructuring plan filed on March 22, 2021, in the U.S Bankruptcy court in New York. The primary objective of the restricting plan is to get the drugmaker out of Chapter 11 bankruptcy.
If accepted, the deal will release the Sackler family and Purdue Pharma from further opioid litigation.
The settlement proposal is a critical milestone in the drug manufacturer’s bankruptcy case and the culmination of several months of thorough negotiation between members of the Sackler family, states, personal injury plaintiffs, and other creditors.
So, what transpired before the settlement deal was struck? Purdue Pharma moved to court to file for Chapter 11 bankruptcy in 2019 in an attempt to resolve the numerous opioid lawsuits filed against it.
When filing its first bankruptcy case in 2019, the Sacklers had agreed to pay approximately $3billion with a promise of another $1.5billion that would be paid after the sale of its international businesses.
Many states and local governments had sued the drugmaker accusing it of fueling the opioid epidemic by aggressively marketing its prescription painkiller, OxyContin.
In October 2020, the company agreed to an $8billion opioid settlement deal and pleaded guilty to at least three federal charges to resolve civil and criminal investigations into how it marketed its opioid painkillers.
However, the quoted figure was largely seen as symbolic since the company’s existing assets fell short of the estimated figure by far. Realistically, Purdue Pharma was expected to pay about $225million to the federal government while members of the Sackler family would separately raise another $225million to resolve the numerous civil claims.
The $225million payment from the Sackler family is separate from the $4.28billion the company has offered to pay as part of the new settlement plan.
Sackler Family Net Worth
It is alleged that the Sackler family’s total net worth is approximately $10.8billion, as estimated by Forbes last year. Much of this wealth was generated from profits that the Sacklers received from the drugmaker between 2008 and 2017.
However, the settlement deal will strip the family of Purdue Pharma ownership subject to approval from the federal bankruptcy court in New York. The proposal seeks to turn Purdue Pharma into a new company with an independent board.
But members of the Sackler family will be allowed to continue managing the offshore subsidiaries of the company for at least seven years before the next course of action is determined.
Even though Purdue Pharma will be allowed to continue selling OxyContin and other drugs, it will be expected to prioritize selling medications that treat opioid addiction and overdose symptoms.
In a press statement shared with media houses, the company’s president said that they were willing to put Purdue’s assets to work to address the opioid crisis for once and for all. He further stated that he was confident the plan would achieve that critical goal and help end the epidemic.
What to Expect Going Forward
Although the proposed opioid settlement deal seems reasonable, it will most likely face stiff opposition from various plaintiffs, including several states and U.S territories.
Even if the opioid settlement deal is approved, it can still be challenged in court by groups of people who have been negatively impacted by opioids and some state attorney generals who haven’t accepted the deal.
General Maura Healey, the attorney general of Massachusetts, along with 23 other attorney generals, have already voiced their opposition to the agreement calling for more transparency and larger upfront payment from the Sackler family.
Join Opioid Lawsuits Today
According to the Centers for Disease Control and Prevention (CDC), nearly 500,000 Americans have died from overdoses of both prescription and illegal opioids, since 1999. Millions of others have developed opioid addiction and are currently struggling to regain control over their lives.
The statistics paint a grim picture of a country struggling with an opioid epidemic fuelled by people tasked with protecting the population from such risks. That is why some attorney generals are adamant that anyone who played a role in fueling the crisis must be punished harshly.
Have you or your loved one developed an opioid addiction after taking prescription opioid painkillers? You may qualify for compensation. Talk to an experienced opioid lawsuit attorney today to find out if you are eligible for compensation.