Indiana Attorney General Curtis Hill is among the 29 attorneys general across the country backing a proposed settlement with OxyContin maker Purdue Pharma, calling the agreement a “significant breakthrough in our important fight against the opioid crisis.”
The multibillion-dollar settlement is part of Purdue’s Chapter 11 bankruptcy case which was filed Sunday. Under the terms of the agreement, the company would provide $10 billion to $12 billion to help reimburse state and local governments for repairing the damage caused by the powerful prescription painkillers and illegal opioids, including heroin.
“Under the proposed solutions supported by 29 attorneys general, money starts flowing to those who need it most,” Hill said in a statement to the Indiana Lawyer. “The framework holds both Purdue Pharma and the Sackler family directly accountable for their roles in this devastating crisis.”
The November lawsuit alleges the pharmaceutical giant promoted widespread overprescribing of OxyContin through a “deceptive and misleading” marketing campaign that has led to a “full-blown public health crisis.”
In 2016, there was a statewide average of 84 opioid prescriptions per 100 Indiana residents, which was among the highest opioid prescription rates in the country, according to the lawsuit. Also between 2010 and 2016, more than 3,000 Hoosiers died of opioid overdoses, and an estimated 89,000 Indiana residents are currently battling opioid dependence and addiction, the lawsuit stated.
“The opportunity to recover more than $5 billion represented a significant breakthrough in our important fight against the opioid crisis,” Hill said of the proposed settlement. “The Sackler family would be required under the terms of the agreement to contribute at least $3 billion and would be out of the pharmaceutical business both domestically and internationally.”
Several states are rebuffing the proposal, believing the company and the Sacklers are not being penalized enough. The New York Attorney General’s office revealed in court papers filed days before Purdue filed for bankruptcy the Sackler family had transferred $1 billion to themselves.
“In no uncertain terms, any deal that cheats Americans out of billions of dollars, allows the Sacklers to evade responsibility and lets this family continue peddling their drugs to the world is a bad one, which is why New York remains opposed to it,” New York Attorney General Letitia James said Monday of the proposed settlement. “My office will not be deterred in its lawsuit against the Sackler family, and will continue fighting to make this family pay for the death and destruction they inflicted on the American people.”
In announcing the proposed agreement, Steve Miller, chairman of Purdue’s board of directors, said the settlement would allow billions of dollars to go toward helping communities cope with the opioid crisis rather than “wasting hundreds of millions of dollars and years on protracted litigation.”
Hill echoed those sentiments in his statement.
“The alternative to these positive outcomes is protracted litigation with an uncertain future, especially in light of Purdue Pharma’s bankruptcy proceedings,” the Indiana Attorney General said.
Tuesday, at the first court hearing since the Chapter 11 filing late Sunday, Purdue lawyers secured permission for the multibillion-dollar company based in Stamford, Connecticut, to maintain business as usual — paying employees and vendors, supplying pills to distributors, and keeping current on taxes and insurance.
The continued viability of Purdue is a key component of the company’s settlement offer, which could be worth up to $12 billion over time.
Under the proposal, backed by about half the states, the Sackler family, which owns Purdue, would turn the company, its assets and more than $1 billion in cash reserves over to a trust controlled by the very entities suing it.
The Sacklers have also agreed to pay a minimum of $3 billion of their own money to the settlement over seven years, as well as up to $1.5 billion more in proceeds from the planned sale of their non-U.S. pharmaceutical companies.
“This is a highly unusual case in that the debtors have pledged to turn over their business to the claimants,” U.S. Bankruptcy Judge Robert Drain said. “All of the claimants, in essence, have the same interest in maximizing the value of the business and avoiding immediate and irreparable harm.”
Joe Rice, a lawyer for some of the plaintiffs, estimated it could be more than a year before the bankruptcy and settlement are finalized.
“This is not a sprint. We’ve got a little bit of a marathon here,” he said after the three-hour hearing in New York City’s northern suburbs.
— The Associated Press contributed to this report.