- Purdue Pharma, the maker of opioid OxyContin, was dissolved in a wide-ranging bankruptcy settlement that replaces it with a new public benefit company.
- The Sackler family, owners of Purdue Pharma, will turn over $4.5 billion to address opioid addiction and treatment across the U.S.
- The agreement largely absolves the family of opioid-related liability and will maintain their status among the wealthiest families in the country.
OxyContin maker Purdue Pharma's controversial $4.5 billion bankruptcy settlement was approved on Sept. 1, 2021. It ends court claims of the company's involvement in the opioid epidemic. The wide-ranging settlement requires the company’s owners, members of the Sackler family, to turn over billions of dollars to address opioid addiction.
Judge Robert Drain of the U.S. Bankruptcy Court in White Plains, N.Y., approved the settlement. As part of it, Purdue Pharma was dissolved and replaced with a new public benefit company, whose profits will fund opioid addiction and treatment. According to the CDC, more than 500,000 people have died from opioid use since 1999.
The deal includes a controversial condition that absolves the Sacklers of any further civil opioid liability. They will remain among the richest families in the country. The protections for the family—which are sometimes given for companies that emerge from bankruptcy when the owners file for bankruptcy themselves—were part of a negotiated deal with state and local governments.
Reportedly, Purdue will make initial payments of roughly $500 million. The Sackler family has not filed for bankruptcy, but it will pay out the approximately $4 billion, including federal settlement fees, in installments over about nine years. Those payments, as well as any profits from a new drug company formed from the now-defunct Purdue Pharma, will go to addiction treatment and prevention programs across the country and on tribal land.
Several states, including Connecticut and Washington State, have said they intend to appeal the bankruptcy judge’s decision.