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 The attorneys general for eight states and the District of Columbia,
who had blocked a previous settlement that included a $4.3 billion
cash payment, announced the deal after weeks of mediation with the
Sacklers.
The family agreed to pay at least $5.5 billion in cash, which will
be used for abating a crisis that has led to nearly 500,000 U.S.
opioid overdose deaths over two decades.
The value of the deal could grow as the family members sell
additional assets.
The Sackler family owners said in a statement that they "sincerely
regret" that OxyContin "unexpectedly became part of an opioid
crisis."
The family members said they acted lawfully but a settlement was by
far the best way to help resolve a "serious and complex public
health crisis."
U.S. Bankruptcy Judge Robert Drain must approve the deal, which
protects the Sacklers from civil lawsuits. Purdue requested a March
9 hearing for Drain to review the agreement.
Purdue said on Thursday that the new settlement would provide
additional funding for opioid abatement programs, overdose rescue
medicines, and victims, while putting the company on track to
resolve its bankruptcy case on "an expedited schedule."
When the bankruptcy plan takes effect, Purdue Pharma will cease to
exist. It will emerge as a new company, Knoa Pharma LLC, owned by
the National Opioid Abatement Trust, an entity controlled by
creditors of Purdue.
Opioid overdose deaths soared to a record during the COVID-19
pandemic, including from the powerful synthetic painkiller fentanyl,
the U.S. Centers for Disease Control and Prevention has said.
The Sacklers' agreement follows an announcement on Friday by the
three largest U.S. drug distributors and Johnson & Johnson that they
would finalize a $26 billion plan to settle allegations over their
role in the opioid crisis.
Purdue filed for bankruptcy in 2019 in the face of thousands of
lawsuits accusing it and members of the Sackler family of fueling
the opioid epidemic through deceptive marketing of its highly
addictive pain medicine.
The company pleaded guilty to misbranding and fraud charges related
to its marketing of OxyContin in 2007 and 2020. Members of the
Sackler family have denied wrongdoing.
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 The new deal was announced over two months after
U.S. District Judge Colleen McMahon overturned
the earlier settlement, which contained sweeping
legal protections for the Sacklers from future
opioid-related litigation. Eight
states, Washington D.C. and the U.S. Department of Justice’s
bankruptcy watchdog said at the time that the Sacklers should not be
afforded such protections since they did not file for bankruptcy
themselves.
While bankruptcy judges have increasingly granted such releases over
the years when approving a reorganization plan, McMahon ruled that
the bankruptcy court did not have that legal authority.
As part of the new deal, the holdout states and D.C. agreed to drop
their opposition to the protections.
SERVING JUSTICE
Connecticut's William Tong, one of the attorneys general who agreed
to the settlement, said he recognized its limits.
"No one is under any illusion this solves all the problems we're
facing," Tong said at a news conference.
Tong and the mediator urged Drain to allow victims of the opioid
epidemic to address the court when the judge considers approving the
settlement and to order the Sackler family members to attend.
The mediator, U.S. Bankruptcy Judge Shelley Chapman, said in a court
filing it was her "heartfelt belief" that doing so would "serve the
ends of justice."
Under Thursday's settlement, $276 million of the increased Sackler
contribution will be dedicated to the eight states that had opposed
the prior deal and the District of Columbia.
(Reporting by Tom Hals in Wilmington, Delaware and Jonathan Stempel
and Dietrich Knauth in New York; Editing by Noeleen Walder and Bill
Berkrot)
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