Sackler family agrees to $6 billion settlement for role in opioid epidemic
The Sacklers issued a statement that said "the families have acted lawfully in all respects."
Connecticut will receive a $95 million share of a $6 billion settlement with Purdue Pharma and its owners the Sackler family.
The Stamford-based pharmaceutical company produces the prescription painkiller OxyContin. The money will be used to fund opioid treatment and prevention.
Attorney General William Tong made the announcement Thursday, noting the amount is 40% more than the previous proposal.
Tong said the Sacklers will be forced to “apologize in dollars, words and actions.”
Related: Drug companies move forward on $26B opioid deal
The Sacklers issued a statement that read: “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.”
If the agreement is approved by a U.S. Bankruptcy Court, the Sackler family would be protected from civil lawsuits but not criminal liability. In September 2019, Purdue filed for bankruptcy protection.
The agreement authorizes Connecticut to use part of the settlement funds to establish an Opioid Survivors Trust to directly aid survivors and victims of the opioid epidemic.
Under the bankruptcy plan, Purdue must be dissolved or sold by 2024 and the Sacklers will be banned from the opioid business in the United States and around the world.
The settlement also forces disclosure of records previously withheld as privileged, including legal advice regarding advocacy before Congress; the promotion, sale and distribution of Purdue opioids; the structure of the Purdue Compliance Department and its monitoring and abuse deterrence systems; and documents regarding recommendations from Purdue consultant McKinsey & Co., and marketing firms Razorfish and Publicis Healthcare Communications Group related to the sale and marketing of opioids.
The settlement, reached Thursday, is the result of a court-ordered mediation, which began on Jan. 3 under U.S. Bankruptcy Judge Shelley C. Chapman.
Connecticut sued Purdue and individual members of the Sackler family in 2018, alleging that the company and family peddled falsehoods to push patients toward its opioids, earning multimillion-dollar profits while addictions skyrocketed.
Connecticut amended the suit in 2019 to include additional defendants and allegations, including the alleged fraudulent transfer of hundreds of millions of dollars from Purdue Pharma to the Sacklers to shield their wealth.
Connecticut was among eight “holdout” states and the District of Columbia that opposed an earlier proposed settlement in which the Sackler family would pay $4.3 billion over nine years.
In December 2021, the U.S. District Court vacated the Purdue bankruptcy order, agreeing that the bankruptcy court lacked authority to force states to release their claims against the Sackler family.
Purdue has appealed to the U.S. Court of Appeals for the Second Circuit. Tong said if the case lands at the U.S. Supreme Court, Connecticut “reserves its right to continue its fight against non-consensual, non-debtor releases.”
Tong said the settlement was “constrained by the inadequacies of our federal bankruptcy code.”
“But Connecticut cannot stall this process indefinitely as victims and our sister states await a resolution,” he said. “This settlement resolves our claims against Purdue and the Sacklers, but we are not done fighting for justice against the addiction industry and against our broken bankruptcy code.”
Over the last year, Tong has brokered two other major opioid settlements.
Pharmaceutical distributors Cardinal Health, McKesson and AmerisourceBergen, along with manufacturer Johnson & Johnson, will pay $26 billion, including about $300 million to Connecticut, over the next 18 years to fund treatment, prevention and recovery programs, according to Tong’s office.
Meanwhile, McKinsey & Co. will pay $573 million, including $7.5 million to Connecticut, over the next five years for advising Purdue, according to Tong.
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