All 50 states agree to $7.4B opioid crisis settlement
Last week, all 50 states and Washington, D.C. settled a massive $7.4 billion lawsuit with Purdue Pharma, the company responsible for the development and distribution of OxyContin.
The settlement resolves allegations that the company, and its owners the Sackler family, aggressively pushed drug representatives to sell the drug and other opioid products, contributing significantly to the nation’s opioid crisis.
The settlement was signed by 55 attorneys general—which includes five U.S. territories signed on as co-plaintiffs—but will still need to be confirmed by a judge. Last year, the Supreme Court rejected a $6 billion settlement, over a complicated issue involving the bankruptcy of the company and its legal protection from litigation.
It remains to be seen if the larger amount will be enough to appease regulators and the courts.
As part of the agreement, the Sackler family also agreed to surrender ownership of the company and to stay out of the business of selling opioid-related drugs. The family is also partially responsible for paying a significant portion of the $7 billion settlement out of their own pocket, with the company liable for the rest.
The payout will happen over multiple years, but it’s top-heavy—the Sacklers will pay $1.5 billion out of their own pockets in year one, with Purdue paying approximately $900 million.
The settlement is the third largest in history related to the opioid epidemic.
Money to be used for addiction recovery
The settlement fund—after legal fees are resolved—will be used to support state and local opioid addiction treatment programs, including prevention and education.
The goal is for the money to serve the public and victims of the opioid crisis for 15 years, attorneys general representing the plaintiffs said.
Much like an individual consumer class action, local governments will need to sign onto the settlement to make a claim for disbursement. The details for how much of the settlement fund will go directly to programs still needs to be worked out in bankruptcy court.
Purdue filed for Chapter 11 in 2019, after facing thousands of lawsuits. OxyContin, at the center of most of those claims—many of which are resolved with this settlement—was introduced to the market in the 1990s.
Today, it’s still prescribed as a generic medication, oxycodone.
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.