Purdue Pharma Sentenced in Criminal Opioids Case, Paving Way for Settlement Funds
A judge has sentenced OxyContin maker Purdue Pharma to forfeit $225 million to the U.S. government, a move that allows the company to finalise a settlement addressing thousands of lawsuits related to its role in the opioid crisis. This penalty, agreed upon in a 2020 pact to resolve federal civil and criminal investigations, clears the path for Purdue to settle other legal claims without further penalties being collected.
Years of Legal Proceedings Culminate in Sentencing
The sentencing marks the culmination of years of legal twists and turns, with the settlement approved by another judge last year and set to take effect from May 1. Under the terms, members of the Sackler family, who own Purdue Pharma, are required to pay up to $7 billion over 15 years to state, local, and Native American tribal governments, as well as some individual victims and other entities.
In November 2020, Purdue pleaded guilty to three federal criminal charges. The Stamford, Connecticut-based company admitted to lacking an effective programme to prevent its powerful prescription painkillers from being diverted to the black market, despite assurances to the U.S. Drug Enforcement Administration. It also confessed to paying doctors through a speakers programme to prescribe opioids and funding an electronic medical records company to send doctors information encouraging more opioid prescriptions.
Financial Penalties and Broader Settlement Details
While Purdue is expected to pay the $225 million forfeiture, the government agreed in the plea deal not to collect $5.3 billion in criminal forfeitures and fines and $2.8 billion in civil liabilities. Instead, portions of these amounts are integrated into the broader settlement, with the federal government receiving a small share. The Sackler family's contribution of up to $7 billion is among the largest in a series of settlements by drugmakers, wholesalers, and pharmacies in recent years, and it uniquely includes payments for individual victims or their survivors.
Collectively, these settlements exceed $50 billion, with most funds designated to combat the overdose epidemic. Under the Purdue deal, Sackler family members will be shielded from opioid-related lawsuits from parties accepting the payments. Purdue itself will cease operations, replaced by a new entity, Knoa Pharma, which will operate for public benefit under a board appointed by states. This reorganisation is noted as one of the most complex ever, with Purdue having paid over $1 billion to law firms and professionals involved in the case by the end of last year.
Victim Advocacy and Calls for Justice
Despite over 54,000 people with personal injury claims voting to accept the settlement, with only 218 against, some victims and their families continue to push back. They argue that the settlement and guilty plea fall short of justice for a crisis linked to 900,000 deaths in the U.S. since 1999. Susan Ousterman, whose son died from an overdose in 2020, organised others to deliver victim impact statements ahead of the sentencing, aiming to persuade the judge to reject the plea deal and for the U.S. Justice Department to pursue criminal charges against individuals, including Sackler family members.
Ousterman criticised the allocation of funds, noting that some governments have not used received money effectively or in ways closely linked to fighting the drug crisis. Meanwhile, Sackler family members, long cast as villains in the opioid crisis for seeking increased profits amid rising addiction and overdose rates, have not been charged. They received $10.7 billion in payments from Purdue between 2008 and 2018, with no payments since 2018 and the last family member leaving Purdue's board in 2019. Under the settlement, they will not object to their names being removed from museums and institutions they supported.
