OxyContin maker Purdue Pharma has dissolved after a federal judge approved its criminal sentence, resolving thousands of lawsuits linked to the opioid crisis. According to multiple reports, U.S. District Judge Madeline Cox Arleo delivered the sentence on Tuesday in Newark, New Jersey, following hours of impact statements from victims and their families.
Key Takeaways
U.S. District Judge Madeline Cox Arleo approved the dissolution of Purdue Pharma as part of its criminal sentence, resolving thousands of lawsuits tied to the opioid crisis. The Sackler family will contribute up to $7 billion over 15 years, with most funds going to combat the opioid epidemic.
- Purdue Pharma dissolves and re-emerges as Knoa Pharma, a nonprofit focused on treating opioid addiction
- Judge Arleo approved the settlement after hearing impact statements from victims and their families
- The Sackler family will contribute $7 billion over 15 years to address the opioid crisis
- Purdue Pharma admitted to deceiving regulators and paying kickbacks to boost OxyContin sales
- Knoa Pharma's board includes health industry leaders committed to providing affordable addiction treatment
The settlement calls for members of the Sackler family, who own Purdue Pharma, to contribute up to $7 billion over 15 years. Most of this money will go to government entities to combat the opioid crisis. The guilty plea and civil settlement with the federal government included $8.3 billion in forfeitures, fines, and penalties.
Victims expressed frustration during the hearing, arguing that the negotiated sentence does not provide real justice. Many asked Arleo to reject the deal, citing personal losses due to opioid addiction. The judge sympathized with their plight but ultimately approved the settlement as it was the best outcome she could achieve under current legal frameworks.
Purdue Pharma admitted to deceiving government regulators and paying kickbacks to doctors to boost opioid sales. However, only the company was charged, not individual employees or owners. The settlement is among the largest in a series of settlements by drugmakers, wholesalers, and pharmacies in recent years.
The dissolution of Purdue Pharma will see it replaced by Knoa Pharma, a new nonprofit company focused on combating the opioid crisis. Millions of internal Purdue documents are to be made public as part of the settlement. The Sackler family has also agreed not to object if their names are removed from museums and other institutions they have supported.
Knoa Pharma's board includes health industry leaders such as Rahul Gupta, who led the White House Office of National Drug Control Policy under President Joe Biden; Paul Rothman, former CEO of Johns Hopkins University School of Medicine; and David Saltzman, co-founder of the Atria Health and Research Institute. Knoa will sell medicine for overdose reversal and addiction treatment at or below its cost of production.
About 40% of individual claims have already been rejected according to a Reuters review of court filings and interviews with opioid victims. The majority of Purdue’s settlement money will go to states and local governments that bore the costs of opioid addiction in their communities, while $865 million is earmarked for individual claimants who became addicted to opioids or lost loved ones.
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