Judge approves opioid settlement for Purdue Pharma and Sackler family members who own the company

A federal bankruptcy court judge on Tuesday formally approved OxyContin maker Purdue Pharma’s plan to settle thousands of lawsuits over opioid harm.

U.S. Bankruptcy Judge Sean Lane on Tuesday gave reasons for approving the plan, which requires members of the Sackler family, who own the company, to contribute up to $7 billion over 15 years. Most of the money will go to government entities to combat the opioid crisis, linked to 900,000 deaths in the United States since 1999.

Some of the money will be distributed next year to some people who had received OxyContin prescriptions and their survivors.

“My heart goes out to everyone who has endured such pain,” Lane said.

The new deal replaces one that the U.S. Supreme Court rejected last year, finding it would have improperly protected family members from future lawsuits. Under the current agreement, entities that don’t accept payments can still sue family members.

The agreement, which the judge said he would accept last week, is one of the largest in a series of opioid settlements brought by state and local governments against drugmakers, wholesalers and pharmacies, totaling about $50 billion.

Members of the Sackler family agreed to pay up to $7 billion over 15 years, providing most of the money involved in the settlement.

Funds distributed to states, local residents, and Native Americans must be used primarily to address the opioid crisis, as has been the case in other opioid settlements.

Of that, about $850 million will be paid to individual victims, including children born with opioid withdrawal.

Dependent individuals and survivors of those who have died must prove they were prescribed OxyContin to participate. Those who do could receive payments of about $8,000 or about $16,000, depending on how long they received the drug and how many other people qualify. The money for individual victims is to be distributed next year.

Sackler family members agree to relinquish ownership of Purdue.

For them, this will not be a major change since no family member has served on Purdue’s board or received money from the company since 2018. The plan calls for replacing Purdue with a new company, Knoa Pharma, controlled by a state-appointed board of directors with a mission to benefit the public.

Members of the Sackler family also agree that their names will not be put on institutions in exchange for contributions – something they have often done in the past, even though many institutions have severed ties with them.

The company also agreed to make public a trove of internal documents that could shed additional light on how it promotes and monitors opioids.

One feature that will not be repeated in this new agreement that appeared in a previous one: requiring members of the Sackler family to hear directly from those harmed by OxyContin.

Purdue filed for bankruptcy protection in 2019 as it faced thousands of opioid-related lawsuits from state, local and other governments.

A judge approved a settlement two years later. But the U.S. Supreme Court later rejected the plan because it gave members of the Sackler family protection from opioid lawsuits even if they did not personally file for bankruptcy.

The latest plan allows for lawsuits against members of the Sackler family by those who do not adhere to the agreement. This change was key to getting the new version approved following the High Court ruling.

This time, few parties opposed the settlement, although some self-represented people who were addicted to opioids — or whose loved ones were — raised concerns during the three-day confirmation hearing last week.

One of those unrepresented people told Lane during Tuesday’s virtual hearing that she plans to appeal.