A federal bankruptcy judge announced on Friday that he intends to approve a major settlement with Purdue Pharma, the manufacturer of the prescription painkiller OxyContin. The agreement, valued at up to $7 billion, resolves thousands of lawsuits alleging the company fueled the nation’s opioid crisis.
Under the terms, members of the Sackler family, who own Purdue, will be required to contribute billions and relinquish control of the Connecticut-based pharmaceutical firm. The settlement replaces a previous deal struck down by the U.S. Supreme Court last year, which the court said offered the family excessive legal protections.
This resolution marks one of the largest in a wave of nationwide opioid litigation, which has seen drug manufacturers, distributors, and pharmacies agree to pay approximately $50 billion collectively. The case against Purdue has been described as among the most complex bankruptcy proceedings in U.S. history.
The agreement aims to close a long legal battle over the company’s role in an epidemic linked to hundreds of thousands of overdose deaths since the late 1990s. While some involved in the litigation expressed relief at the conclusion, others criticized the lengthy process. One plaintiffs’ attorney stated the case “never should have been in bankruptcy; it should have been in criminal court,” and noted that other companies in the industry settled more swiftly.
Following the bankruptcy, Purdue Pharma will be dissolved and transformed into a new public-benefit entity named Knoa Pharma. This organization will focus on developing and distributing medications to reverse opioid overdoses and treat addiction.
The judge is expected to issue a formal ruling detailing the settlement next week.