Pharmaceutical giant Purdue Pharma and the billionaire Sackler family who owned it have finally been forced to pay $7.4 billion for their central role in America’s devastating opioid epidemic, ending their control of the company and banning them from the U.S. opioid business forever.
Key Takeaways
- All 50 states, Washington D.C., and four U.S. territories unanimously approved the $7.4 billion settlement with Purdue Pharma and the Sackler family
- The Sackler family will contribute approximately $6.5 billion and permanently lose control of Purdue Pharma while being banned from selling opioids in the U.S.
- Settlement funds will be distributed over 15 years with most allocated within the first three years for addiction treatment, prevention, and recovery programs
- The agreement follows multiple failed settlement attempts, including a Supreme Court reversal of a previous $6 billion deal that would have shielded the Sacklers from lawsuits
- Critics argue the $850 million allocated for direct victims is insufficient compared to the billions going to government programs
A Historic Settlement After Years of Legal Battles
The landmark $7.4 billion settlement represents a significant victory against the pharmaceutical industry that fueled America’s deadly opioid crisis. This deal, backed by all 50 states, Washington D.C., and four U.S. territories, comes after multiple failed attempts, including a 2021 court-approved plan and a subsequent $6 billion settlement that were both overturned. The agreement ends the Sackler family’s control of Purdue Pharma and permanently bans them from selling opioids in the U.S. market. The settlement will provide crucial funding for opioid addiction treatment, prevention, and recovery programs nationwide over the next 15 years.
The settlement structure includes an initial $1.5 billion payment from the Sacklers and approximately $900 million from Purdue Pharma. The remaining funds will be distributed over the next 15 years, with most of the money allocated to states within the first three years. This approach ensures immediate relief for communities devastated by opioid addiction while providing sustained funding for long-term recovery efforts. Notably, this new agreement differs from previous attempts by allowing individuals to retain their rights to sue the Sacklers in civil court, addressing a key concern that led to earlier rejections.
State Leaders Respond to the Settlement
Attorneys general across the country have expressed mixed feelings about the settlement, acknowledging its limitations while recognizing its necessity. Many state leaders emphasized that while no amount of money can fully address the damage caused by the opioid crisis, the settlement represents an important step toward accountability and prevention of future harm. The agreement has garnered unprecedented, unanimous support from all eligible states and territories, reflecting the urgent need for resources to combat the ongoing epidemic of opioid addiction and overdose deaths.
“While we know that no amount of money can erase the pain for those who lost loved ones to this crisis, this settlement will help prevent future tragedies through education, prevention, and other resources,” said New Jersey Attorney General Matthew Platkin.
Connecticut Attorney General William Tong offered a more somber assessment, stating: “There will never be enough justice, accountability, or money to restore the families whose lives have been wrecked or to right the terrible consequences of the Sackler family’s craven misconduct. What we announce today is both momentous and insufficient, the culmination of years of tumultuous negotiations and legal battles up to the U.S. Supreme Court.” The settlement comes at a critical time as states continue to grapple with the enormous economic and social costs of opioid use disorder, which is estimated at nearly $700,000 per case.
The Future of Purdue Pharma and Ongoing Concerns
Under the settlement terms, Purdue Pharma’s future will be determined by a board of trustees, and the company will be closely monitored to prevent lobbying or marketing of opioids. The restructured company described the agreement as a “critical milestone” in providing compensation and addressing the opioid crisis. However, the Sackler family has maintained they did nothing wrong, despite overwhelming evidence of their company’s aggressive and deceptive marketing of highly addictive painkillers that helped spark a nationwide health crisis that has killed hundreds of thousands of Americans.
“Today’s announcement of unanimous support among the states and territories is a critical milestone towards confirming a Plan of Reorganization that will provide billions of dollars to compensate victims, abate the opioid crisis, and deliver opioid use disorder and overdose rescue medicines that will save American lives. We appreciate the extraordinarily hard work of the state attorneys general and our other creditors in getting us to this point, and we look forward to soliciting creditor votes on the Plan after the disclosure statement is approved,” said Purdue.
Critics of the settlement have voiced concern that only about $850 million has been allocated to compensate direct victims, a figure many consider grossly inadequate given the scale of suffering caused by Purdue’s OxyContin and other opioid products. If finalized, this agreement will contribute to over $50 billion in total payouts related to the opioid crisis from various corporations involved in manufacturing and distributing opioid painkillers. The settlement now awaits approval from the bankruptcy court after Purdue filed a new bankruptcy plan in March to facilitate the agreement.
