Purdue Pharma’s deal means money for some victims, end of Purdue company name. Here’s what to know

A judge said Friday he plans to approve a deal between OxyContin maker Purdue Pharma and members of the Sackler family, which owns the company, to settle thousands of lawsuits over the opioid toll, allowing money to start flowing to victims as early as next spring.

U.S. Bankruptcy Court Judge Sean Lane said he would lay out his reasoning at a hearing next week.

Here’s what you need to know.

Members of the Sackler family have been portrayed as the villains in an overdose epidemic linked to 900,000 deaths in the United States since 1999, including from heroin and illicit fentanyl.

Although most opioids were sold by other companies, many people described the marketing of OxyContin, sold beginning in 1996, as one of the triggers for the crisis.

Amid mounting legal issues, the family members left the company’s board of directors in 2018 and have received no compensation since then. But over the previous decade, they received more than $10 billion from the company that has been in the family for decades. About half of this money was used to pay taxes.

Under the terms of the deal, they will contribute up to $7 billion and cease ownership of the company.

They will also be prohibited from carrying out activities in the opioid sector in other countries and will agree not to have their name listed on any institution in connection with charitable contributions. Many museums and universities have already severed ties with the family.

The plan also calls for changing the name of Stamford, Conn.-based Purdue to Knoa Pharma and making it an entity dedicated to the public good with a board of directors appointed by state officials.

It could still produce OxyContin, but the vision is that the company’s profits will help address the nation’s opioid crisis.

It would also be subject to independent oversight, as Purdue has been in recent years.

The company agreed to make millions of internal documents public, many of which would normally be subject to attorney-client privilege.

He also still faces the formality of a conviction in a guilty plea he negotiated with the U.S. Justice Department in 2020 after admitting that he paid doctors through a speakers program to get them to write more prescriptions and that he had an ineffective program to prevent drugs from being diverted to the black market.

There have been a series of other opioid settlements over the past decade, worth a total of about $50 billion. Most of this money, like most of the Purdue settlement, must be used to combat the overdose and addiction epidemic.

But none of the other major projects have a unique Purdue feature: compensation for individual victims and their survivors.

Purdue’s agreement calls for about $850 million to be paid to victims, with more than $100 million going to care for children born suffering from withdrawal.

This portion of the settlement is expected to be paid next year, while amounts paid to government entities can be paid over 15 years.

But individual compensation is a frustration for victims. Those who qualify by showing they were prescribed OxyContin should be able to collect about $8,000 or $16,000 each, depending on how long they took the powerful painkillers.

A judge approved a previous Purdue settlement plan in 2021, but it was overturned by a U.S. Supreme Court ruling that found members of the Sackler family improperly benefited from protections from lawsuits when they themselves had not filed for bankruptcy protection.

This time, an appeal is less likely, in part because by the time this week’s hearing on the plan was over, no one represented by a lawyer had objected. A handful of individual victims, with no lawyers involved, were the only ones who continued to resist.

In response to last year’s Supreme Court ruling, the new settlement allows opioid lawsuits to be filed against members of the Sackler family by entities not involved in the deal.

The city of Baltimore, for example, has indicated it may take legal action.