Sacklers threaten to walk away from Purdue opioid settlement as anger builds over immunity provisions — report
Purdue Pharma has been negotiating with the government for months over how much it should owe for its role in the opioid crisis, in a plan that’s seen the company declare bankruptcy and plead guilty to three criminal charges.
But the wealthy Sacklers who own Purdue are now reportedly threatening to walk away from the deal should a broad legal shield protecting the family be dropped.
In what’s believed to be the first-ever courtroom appearance from a member of the Sacklers in an opioid case, former board member David Sackler told the bankruptcy court Tuesday the family would not support any deal that doesn’t include an expansive immunity provision protecting individual Sacklers from liability associated with opioid lawsuits, the New York Times reported. The immunity provision has emerged as a contentious issue in the trial, with critics assailing the proposed deal as not going far enough to get justice for those affected by the opioid epidemic.
“We need a release that is sufficient to get our goals accomplished, and if the release fails to do that, then we will not support it,” Sackler reportedly said during the fourth day of testimony. Sackler said should the family follow through on its threat, all cases would be fought “to their final outcomes.”
The Sacklers had pledged to commit $4.5 billion to be paid out over nine to 10 years, in a settlement deal that would see Purdue Pharma turn into a public benefits company dedicated to fighting the opioid crisis. Sackler family members would also give up all ownership of Purdue but be allowed to retain involvement in their other pharma enterprises for up to seven years, when they’d be sold to help fund litigation payments.
Without that sum, the settlement would likely fall apart after nearly two years of negotiations following the company’s bankruptcy filing.
A federal judge had been expected to approve the plan, the NYT reported, after several states that had previously objected to the settlement withdrew their opposition last month. But throughout the bankruptcy trial’s testimony, the Sacklers’ legal shield has drawn significant criticism, and the judge even noted he had “some concerns about the breadth” of the liability protections.
In particular, David Sackler said he expects the immunity will cover not only his family, but about 1,000 other individuals such as contractors and consultants. Sackler added the family is anticipating the protection will extend to lawsuits unrelated to opioids, including future suits over other drugs produced by Purdue and Sackler-owned entities.
Purdue first submitted its Chapter 11 plans in September 2019, following a plethora of lawsuits over at least a decade and a half seeking to hold the drugmaker accountable for its role in the opioid epidemic. Many of these suits objected to Purdue’s marketing strategies of the painkiller Oxycontin, in which the company downplayed its addictiveness.
At first, the plan called for about $10 billion in payments to settle the suits, but that number was revised downward in November 2020 to $8.3 billion when Purdue pleaded guilty to obstructing the DEA’s efforts to combat the crisis, failing to prevent the painkillers from ending up on the black market and encouraging doctors to write more painkiller prescriptions. Purdue pleaded guilty to more charges last month over misleading the federal government about its marketing practices.
Individual members of the Sackler family have not pleaded guilty to any charges.
Purdue is not the only company implicated in the opioid epidemic that has ravaged the US for decades. Insys and Mallinckrodt also filed for bankruptcy, with critics slamming the moves saying they can freeze litigation and leave those litigants competing for payouts with a company’s creditors.