Purdue Pharma opioid plan pits U.S. state against state over epidemic’s cost

Purdue Pharma, maker of the highly addictive painkiller Oxycontin, is pitting state against state with an offer of about $12 billion to resolve the company’s liability for the massive public health crisis tied to opioid abuse that has swept the U.S.

Almost half of the states that are part of the consolidated litigation against Purdue and its billionaire owners, the Sackler family, say the proposal is not nearly enough to make up for the deaths and suffering caused.

The lawsuits, which have in some cases targeted the Sacklers as well as Purdue, claim the family and company contributed to a public health crisis that claimed the lives of nearly 400,000 people between 1999 and 2017, according to the latest data from the U.S. Centers for Disease Control and Prevention. Opioid addiction has hit many rural communities particularly hard.

The suits allege Purdue aggressively marketed prescription painkillers while misleading doctors and patients about their addiction and overdose risks. The suits say Purdue’s practices led to more widespread opioid prescribing, even though only a sliver of the opioid painkillers sold in the U.S. were its products.

The opioid crisis is not confined to America. Australia, for example, is facing its own crisis of soaring opioid use and fatal overdoses despite more than a decade of warnings from Australian health professionals about a looming disaster.

In March, Purdue and members of the Sackler family reached a $270 million settlement with Oklahoma to avoid a trial on the toll of opioids there.

A court filing made public in Massachusetts this year asserts that members of the Sackler family were paid more than $4 billion by Purdue from 2007 to 2018. Much of the family’s fortune is believed to be held outside the U.S., which could complicate lawsuits against the family over opioids.

The Sacklers have given money to cultural institutions around the world, including the Smithsonian Institution, New York City’s Metropolitan Museum of Art and London’s Tate Modern.

On Wednesday, 23 states and three territories told a judge they would support the plan, which calls for the Sacklers to file for bankruptcy and hand Purdue over to a trust controlled by the states, people familiar with the negotiations said. The family would guarantee to pay $3 billion, with most of that generated by the sale of a U.K. unit, the people said.

Texas, Ohio, Florida and Tennessee — all Republican-led states — are among those leading the charge to accept the deal, according to another person familiar with the matter. Their split with states that want more from Purdue could lead to an eventual fight in bankruptcy court and disrupt consolidated settlement talks being overseen by a federal judge in Cleveland.

If approved by a judge, the plan would address the devastating effects of the opioid epidemic “and will result in the Sackler family divesting themselves of their business interests in the pharmaceutical industry forever,” Tennessee Attorney General Herbert Slatery said Wednesday in a statement.

“This is the most significant step to date in a multiyear investigation and negotiation to obtain meaningful relief to address the opioid addiction crisis,” Slatery said. He said a bipartisan group of 27 attorneys general had signed on.

Dave O’Neil, spokesman for Ohio Attorney General Dave Yost, said the proposed settlement “provides the greatest certainty for all Ohioans to receive relief as quickly as possible in light of rumored bankruptcy.”

Several Democratic state attorneys general came out forcefully against the proposal minutes after news broke that the Sacklers’ plan was gaining traction.

“A large number of states are committed to the notion that the Sacklers need to guarantee more money,” North Carolina Attorney General Josh Stein said in a statement. “We believe they created a mess and must help to clean it up.”

Pennsylvania Attorney General Josh Shapiro said in a statement that the proposal is “a slap in the face” to victims.

“A deal that doesn’t account for the depth of pain and destruction caused by Purdue and the Sacklers is an insult, plain and simple,” New York Attorney General Letitia James said in a statement. “As attorney general, I will continue to seek justice for victims and fight to hold bad actors accountable, no matter how powerful they may be.”

Other states disagreed.

“Sadly, this agreement cannot bring back those who have lost their lives to opioid abuse, but it will help Florida gain access to more life-saving resources and bolster our efforts to end this deadly epidemic,” Florida Attorney General Ashley Moody said in a statement. “We will continue to aggressively pursue our state case against all remaining defendants.”

William Tong, the attorney general of Connecticut, said in a statement on Wednesday that his state hasn’t signed on to any deal and that he is prepared to pursue claims against Purdue even in bankruptcy court, if it comes to that.

“Our position remains firm and unchanged,” Tong said. “The scope and scale of the pain, death and destruction that Purdue and the Sacklers have caused far exceeds anything that has been offered thus far.”

Ryan Hampton, a Los Angeles-based advocate for people in recovery from opioid addiction, said he was launching “a massive effort” among victims’ families and others impacted by the crisis to urge state attorneys general not to accept the deal.

“The amount of money that’s being offered in this settlement doesn’t even scratch the surface for what’s needed,” Hampton said. “We want to see Purdue have their day in court. We know more money will come if this case goes to trial.”

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