Proposed $7 billion Purdue settlement advances; leaves Sacklers exposed

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Since last July when the U.S. Supreme Court rejected the Purdue Pharma opioid bankruptcy agreement, negotiation has continued. The latest offer from the Sackler family may have enough support from stakeholders to stick.

"OxyContin maker Purdue Pharma’s latest plan to settle thousands of lawsuits over the toll of opioids could soon move forward after every U.S. state involved agreed to it," reports Geoff Mulvihill of The Associated Press. U.S. Bankruptcy Court Judge Sean Lane "is being asked to clear the way for local governments and individual victims to vote on it next."

If Lane moves the agreement forward, impacted parties have until Sept. 30 to vote "on whether to accept the deal, which calls for members of the Sackler family who own the company to pay up to $7 billion over 15 years," Mulvihill explains. Roughly $6.5 billion of the settlement will be taken from the Sackler's wealth, and "potentially more than $850 million would go directly to individual victims."

The biggest change the reworked plan offers is that it does not guard Sackler family members from civil liability suits related to the opioid crisis. Groups that reject this settlement can continue litigation against Sackler family members. Mulvihill adds, "Under the plan, the Sackler family members would give up ownership of Purdue."

The $7 billion the Sacklers have put on the table pales in comparison to their exposure. Mulvihill reports, "The settlement is a way to avoid trials with claims from states alone that total more than $2 trillion in damages. Thousands of local governments and other groups have also sued Purdue."

While the settlement is an attempt to hold the Sackler family accountable for its part in the prescription drug crisis, the family will remain exceptionally wealthy and will continue to run its global pharmaceutical company, Mundipharma, which operates in the United Kingdom, Canada, Germany and Singapore.