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July 12, 2021 at 02:00 PM
What You Need to Know
- If the settlement plan is approved, Purdue and the Sacklers will pay $4.5 billion over nine years for prevention, treatment and recovery programs related to opioid addiction across the United States.
- Nine other states and the District of Columbia have yet to agree to the new deal.
- New York State Attorney General Letitia James said this primarily a civil mediation and the agreement is silent on criminal action.
After a marathon mediation session, New York and 14 other states have agreed to a proposed settlement with Purdue Pharma and the Sackler family, according to documents filed late Wednesday in the U.S. Bankruptcy Court for the Southern District of New York.
If the settlement plan is approved by U.S. Bankruptcy Judge Robert Drain, Purdue and the Sacklers will pay $4.5 billion over nine years for prevention, treatment and recovery programs related to opioid addiction across the United States. New York is expected to receive at least $200 million from the settlement.
The agreement also lays out a plan for Purdue to release tens of millions of documents, including 13 categories of attorney-client privileged records, to the public.
New York State Attorney General Letitia James said there could be “no perfect solution” after the tragedies of the opioid crisis, but she said the deal would end “delays and legal maneuvering that could possibly continue for years and across multiple continents.”
“For nearly two years, since Purdue Pharma declared bankruptcy, the company and the Sackler family have used every delay tactic possible and misused the courts—all in an effort to shield their misconduct,” James said. “While this deal is not perfect, we are delivering $4.5 billion into communities ravaged by opioids on an accelerated timetable and it gets one of the nation’s most harmful drug dealers out of the opioid business, once and for all.”
Nine other states and the District of Columbia have yet to agree to the new deal, according to the filing. The agreement was reached after extensive negotiations by phone and in person, according to the filing, including a session lasting from 8:30 a.m. to midnight on July 1.
In a statement, Purdue said it will continue to build consensus for its reorganization plan.
“The progress made in the third and final round of mediation builds upon the support already publicly expressed by nearly every organized creditor group in the bankruptcy proceedings,” the statement said. “We will continue to work to build even greater consensus for our Plan of Reorganization, which would transfer billions of dollars of value into trusts for the benefit of the American people and direct critically-needed medicines and resources to communities and individuals nationwide who have been affected by the opioid crisis.”
