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MANHATTAN (CN) — New York Attorney General Letitia James announced Thursday a multistate $7.4 billion settlement with the Sackler family and Purdue Pharma, the maker of the addictive painkiller Oxycontin, over their role in fueling the opioid crisis.
The settlement, made with a bipartisan coalition of 15 states, ends the Sackler family’s control of Purdue and bars them from selling opioids in the United States. According to James, the funds will go directly to communities over the next 15 years to support opioid addiction treatment, prevention and recovery programs.
The announcement comes after the U.S. Supreme Court struck down a $6 billion deal with Purdue that would have given the Sackler family immunity from future opioid lawsuits, which is not included in the new agreement.
“This will provide educational programs to talk about the dangers of drug addiction, recovery beds, a wide range of sources will be funded as a result of this historic settlement,” James said at a news conference Thursday. “And this will get those suffering the help that they need so that we can save lives, and this hopefully will support those who carry the pain of losing their loved ones.”
This is the largest settlement with individuals that contributed to the opioid crisis in the U.S. The Sackler family will pay for the majority of the settlement — a total of $6.5 billion over 15 years — and Purdue will pay an additional $900 million up front. James added that New York will also receive $250 million from the settlement, which will support opioid treatment and recovery programs throughout the state.
“It is by far the single largest settlement my office has secured, as we have pursued those responsible for sparking ways of addiction and death and destruction all throughout the state of New York,” James said. “And it represents justice for untold victims who suffered because the Sacklers basically put profits over people.”
If the deal is approved by the court, $1.5 billion will be paid immediately. James said they anticipate the settlement going into effect by the end of the year.
After the first payment, an additional $500 million will be paid after one year, and another $500 million after two years.
The settlement leaves Purdue in bankruptcy and barred from lobbying or marketing opioids. The states involved in the settlement — including California, Illinois, Pennsylvania and Texas — will also appoint a board of trustees to determine the future of the company.
Members of the wealthy Sackler family have been under scrutiny for their role in driving Purdue to aggressively market opioid painkillers, perpetuating an epidemic responsible for the deaths of over 700,000 Americans — 300,000 from prescription opioid overdoses alone.
“They operated a vast scheme to flood the market with their product, using deceptive marketing tools, even though they knew their drugs were highly addictive and could be abused,” James said. “They basically created the playbook for marketing opioids.”
The family and company has faced thousands of lawsuits on claims they pushed painkillers on patients, including James’ March 2019 lawsuit that claimed Purdue and other manufacturers engaged in years of deceptive marketing that caused widespread opioid addiction.
“My office is continuing to pursue the pharmaceutical companies, distributors and other corporations that have fueled the opioid crisis,” James said “We will continue to secure more funding for our great state and to support programs in every county that get New Yorkers the help that they need and prevent the abuse of addiction.”
In a statement, Purdue Pharma said it is pleased with the new settlement agreement and is finalizing details of a new reorganization plan it will present to the bankruptcy court.
“We are extremely pleased that a new agreement has been reached that will deliver billions of dollars to compensate victims, abate the opioid crisis, and deliver treatment and overdose rescue medicines that will save lives," the company said.
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