“This Isn’t What We Were Promised” — Critics Slam $10BN Purdue Pharma Opioid Settlement For Letting Sacklers “Off The Hook”
By Tyler Durden
A federal bankruptcy judge has signed off on a settlement between OxyContin maker Purdue Pharma and thousands of creditors and litigants participating in a mountain of lawsuits filed against the company over its role in developing and marketing OcyContin in ways that plaintiffs say violated laws and knowingly exposed millions to an extremely addictive substance.
Under the settlement reached with creditors, including individual victims and thousands of state and local governments, the Sackler family will give up ownership of the company and contribute $4.5 billion, some of which will be used for a victims’ compensation fund. In exchange, members of the family will be freed from liability for any future opioid-related lawsuits, allowing them to retain much of their family fortune, even if their cash cow is now no longer under their control. In total, Purdue values the plan at $10 billion.
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The new company will be reorganized under a board chosen by public officials. Profits will go to government efforts to prevent and treat opioid addiction.
Judge Drain said Wednesday after speaking from the bench for more than six hours that he would approve the plan as long as two technical changes were made. Once made, he plans to enter the final order on Thursday.
Opioids have killed roughly half a million Americans over the last decade, according to CDC data.
One party to the settlement said the deal “isn’t what we were promised.”
“It isn’t what we were promised or what we were hoping for,” said Ryan Hampton, an author and activist who had represented victims during the bankruptcy. Hampton resigned from his post on the victims committee the day before the judge’s decision, in part because he believed the compensation for victims was inadequate, especially compared with the proportion of the fund set aside for the cities, counties, states and other public entities suing Purdue.
At least three parties, led by Washington AG Bob Ferguson, objected to the plan, and are appealing its approval. Ferguson said the settlement as it stands lets the Sackler’s “off the hook”
“This order lets the Sacklers off the hook by granting them permanent immunity from lawsuits in exchange for a fraction of the profits they made from the opioid epidemic — and sends a message that billionaires operate by a different set of rules than everybody else,” Ferguson said.
The chairman of Purdue’s board praised the settlement.
Steve Miller, chairman of Purdue’s board of directors, praised the judge’s decision, saying it was “an outcome that is truly in the public interest.”
“Instead of years of value-destructive litigation, including between and among creditors, this Plan ensures that billions of dollars will be devoted to helping people and communities who have been hurt by the opioid crisis,” he said in a statement.
Once effective, the bankruptcy plan will set aside funds for cities, counties and other entities. Individuals, including those who suffered from addiction, families of people who died of overdoses and babies exposed to opioids in the womb and born with neonatal abstinence syndrome, or NAS, would be entitled to payments ranging from $3,500 to $48,000. The claims would still need to be adjudicated, an effort that could be complicated by that fact that years-old medical records may no longer exist.