The maker of OxyContin has reached a settlement with the state of Oklahoma over the prescription painkiller’s role in the nation’s deadly opioid crisis, officials said on Tuesday.
Oklahoma’s attorney general scheduled an afternoon news conference to announce the terms of the agreement with Purdue Pharma, which has made billions of dollars from OxyContin but has been hit with over 1,000 lawsuits from state and local governments trying to hold the company responsible for the scourge of addiction.
Individuals familiar with the matter said that Purdue Pharma LP and members of the Sackler family who own the company reached a $270m settlement, Reuters reported.
As part of the overall settlement, Purdue will contribute $102.5 million to help fund an addiction treatment centre at Oklahoma State University, a source told Reuters.
The Sacklers, who were not named in the Oklahoma litigation, agreed to contribute $75m towards the university centre as part of the settlement, the source said. Other money will go towards, among other things, covering costs stemming from the lawsuit, including legal fees, the source said.
Prescription opioids like OxyContin were a factor in a record 48,000 deaths across the US in 2017, according to the US Centers for Disease Control and Prevention.
Purdue Pharma has settled other lawsuits over the years, and three executives pleaded guilty to criminal charges in 2007. But this is the first settlement to come out of the current coast-to-coast wave of litigation that focuses mostly on the company’s more recent conduct and threatens to push it into bankruptcy.
The agreement was announced after the Oklahoma Supreme Court on Monday denied a request from drugmakers to postpone the start of the state’s trial in May.
Sandy Coats, a lawyer for Stamford, Connecticut-based Purdue Pharma, did not immediately return a call seeking comment.
A lawyer suing Purdue on behalf of local governments across the country welcomed the settlement.
“That suggests that Purdue is serious about trying to deal with the problem,” said Paul Hanly, who is not involved in the Oklahoma case but is representing scores of other governments. “Hopefully, this is the first of many.”
Of roughly 2,000 lawsuits nationally, more than 1,600 are in federal court and the rest are in state courts.
The 1,600 federal lawsuits were consolidated before a federal judge in Ohio, who has pushed for a settlement ahead of a trial in October. Purdue will likely attempt to finalise any decisions related to a settlement and a bankruptcy filing before that court date, an individual familiar with the matter told Reuters.
Purdue’s settlement with Oklahoma relieves the immediate pressure on the drugmaker for a bankruptcy filing, said Alexandra Lahav, a professor at the University of Connecticut School of Law. She said the company likely was also in talks with others to settle.
“This may be the start of the dominoes falling for Purdue,” Lahav said.
‘Huge disservice to families’
Cheryl Juaire, whose 23-year-old son Corey died of an overdose in 2011, said she was devastated to hear about the settlement. She had been organising a group of hundreds of mothers to go to the first day of the trial and stand outside with photos of their dead children.
Jauire, who lives in Marlborough, Massachusetts, said a complete airing of the facts is the only way to fully hold Purdue to account.
“They can’t settle,” she said. “That would be a huge disservice to the tens of thousands of families here in the United States who buried a child. That’s blood money from our children.”
Oklahoma sued 13 opioid manufacturers in all in 2017, accusing them of fraudulent marketing that led to thousands of overdoses and deaths. State officials have said that since 2009, more Oklahomans have died from opioids than in vehicle crashes.
The 12 remaining defendants still face trial. It would be the first of the current round of lawsuits brought against the industry in the US to go to trial.
Purdue Pharma introduced OxyContin more than 20 years ago and marketed the powerful painkiller aggressively to doctors. Experts say those tactics contributed to overuse and abuse.
As the accusations have mounted, the Sackler family that controls Purdue Pharma has faced personal lawsuits and growing public pressure. A Massachusetts court filing made public earlier this year found that family members were paid at least $4bn from 2007 until last year.
The Sacklers are major philanthropists around the world, and the family name is emblazoned on the walls at many of the world’s great museums and universities. But in the past few weeks, the Tate museums in London and the Guggenheim Museum in New York have cut ties with the family, and other institutions have come under pressure to turn down donations or remove the Sackler name.