Delaware could see $50 million from a new tentative $6 billion settlement with Purdue Pharma and the Sackler family.
Attorney General Jennings said Delaware would use all of the funds for opioid treatment and prevention. Purdue and the Sackler family have long been accused of knowingly producing opioids well in excess of normal demand.
Delaware has been among the hardest-hit states in opioid-related deaths. Delaware and other states rejected an earlier settlement from the company and family. Overdose deaths in Delaware have been in excess of 400 annually in recent years, the second-worst per capita rate in the nation.
“The opioid epidemic has caused immeasurable damage to our state, much of which we can never repay,” said Jennings. “The true costs of this crisis have been borne by the thousands of families who have lost friends and loved ones, and the survivors of the epidemic whose lives have been changed forever. Ultimately, those tragedies grew from seeds that were planted years ago by corporate drug dealers and that spiraled out of control in the name of profit.
“The bottom line is that Delaware’s families deserve the best deal possible. Today’s settlement delivers that, not only through the additional millions of dollars secured for our state, but also through the acceptance of responsibility by the Sacklers, their permanent exile from the industry, and the dismantling of a legacy bought with ill-gotten gains.”
The settlement is conditioned upon approval by the bankruptcy court, on the Second Circuit’s reversal of the District Court’s order, and consummation of the bankruptcy plan. The agreement’s payment schedule could deliver up to $12 million to Delaware in the first 18 months followed by annual payments through 2039.
The settlement keeps intact provisions of the Purdue bankruptcy plan forcing the company to be dissolved or sold by 2024 and banning the Sacklers from the opioid business. The initial bankruptcy plan required Purdue and the Sacklers to make public over 30 million documents. The settlement announced today forces disclosure of additional records previously withheld.
- The Sackler families must pay a total of at least $5.5 billion, with the potential for up to $6 billion. The new deal brings at least $1 billion more than the initial bankruptcy plan, with up to an additional $500 million from the sale of certain international assets. The final payments are spread over 18 years, with larger payments frontloaded so that Delaware will receive more money, sooner as compared to the previous bankruptcy plan.
- The Sackler families have agreed to apologize to victims through a statement of regret for the families’ role in the opioid epidemic.
- The Sackler family must allow institutions to remove the family name from buildings, scholarships, and fellowships. The family was active in such areas.
Delaware first filed suit against Purdue in January 2018, alleging that the company and family peddled a series of falsehoods to push patients toward its opioids, reaping massive profits while opioid addiction skyrocketed. On September 9, 2019, the state also sued seven members of the Sackler family and later that month, Purdue Pharma filed for bankruptcy.
In 2021, the bankruptcy court approved a Purdue bankruptcy plan that granted a lifetime legal shield to the Sackler family.
The plan required the Sackler family to pay $4.3 billion over nine years to the states, municipalities, and plaintiffs that sued the company. California, Connecticut, Delaware, Maryland, Oregon, Rhode Island, Vermont, Washington, and the District of Columbia objected to and ultimately appealed the plan. The United States Trustee, an arm of the United States Department of Justice, also appealed.
In December 2021, U.S. District Court vacated the Purdue bankruptcy order, agreeing with Delaware and the other non-consenting states that the bankruptcy court lacked authority to force states to release their claims against the Sackler family. Purdue has appealed to the United States Court of Appeals for the Second Circuit, and that appeal will proceed.
