Members of the billionaire Sackler family and their company, Purdue Pharma, have reached a deal with a group of US states that had long resisted the company's bankruptcy plan, opening the way for billions of dollars to begin flowing to addiction treatment programmes nationwide, according to a court filing on Thursday.
If judge Robert Drain, who has presided over the bankruptcy proceedings in White Plains, New York, approves the agreement, the Sacklers will pay as much as $6 billion (€5.4 billion) to help communities address the damages wrought by the opioid crisis.
In return, family members will get the prize they had insisted upon for nearly three years: an end to all current and future civil claims against them over the company’s prescription opioid business.
The liability protection does not extend to criminal prosecutions.
In a statement in the report, two branches of the Sacklers did not acknowledge wrongdoing or any personal responsibility for the public health crisis.
“While the families have acted lawfully in all respects, they sincerely regret that OxyContin, a prescription medicine that continues to help people suffering from chronic pain, unexpectedly became part of an opioid crisis that has brought grief and loss to far too many families and communities,” the statement read.
An overwhelming majority of states, local governments, tribes and individuals had already voted for an earlier settlement deal of $4.55 billion. But in December, a federal judge vacated that plan, questioning the legality of the protections from liability granted to the Sacklers.
Corporate bankruptcy typically confers protection from lawsuits for the company that seeks restructuring, but it is unusual for the company’s owners to also get that shield if they did not file for personal bankruptcy as well.
Mediation talks between the eight holdout states and the District of Columbia and the Sacklers began soon after. To get the holdouts on board, the Sacklers had to agree to pay at least an additional $1 billion. Under the new deal, they will pay $5.5 billion, plus a contribution of up to $500 million, contingent on the sale of their international pharmaceutical companies.
The new settlement, however, still faces two potential hurdles. Even if Drain, the bankruptcy judge, signs off, the 2nd US Circuit Court of Appeals has to approve the plan, which would formally reverse the December ruling that rejected the earlier plan. - The New York Times