Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Purdue Pharma in discussion on $10 billion-$12 billion offer to settle opioid lawsuits: sources

EconomyAug 28, 2019 12:15AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items

By Mike Spector and Jessica DiNapoli

(Reuters) - OxyContin maker Purdue Pharma LP and its owners, the Sackler family, are in discussion to settle more than 2,000 opioid lawsuits against the company for $10 billion to $12 billion, two people familiar with the matter said on Tuesday.

Purdue is among several drugmakers and distributors that have been sued for fueling an opioid addiction crisis in the United States, which claimed 400,000 lives from 1999 to 2017, according to the U.S. Centers for Disease Control and Prevention.

The lawsuits have accused the Stamford, Connecticut-based Purdue Pharma of aggressively marketing prescription opioids while misleading prescribers and consumers about risks from their prolonged use. Purdue and the Sacklers have denied the allegations.

Purdue said it was actively working with state attorneys general and other plaintiffs to reach a resolution, without specifying a settlement amount.

There is currently no agreement and the settlement discussions could collapse, the sources said.

Representatives for Purdue and the Sackler family held discussions with cities, counties and states on the contours of the potential multibillion-dollar settlement last week in Cleveland, said a person familiar with the matter.

During the meeting, Purdue outlined a plan to file for Chapter 11 bankruptcy protection as a mechanism for implementing the settlement, which the company hopes will address the lawsuits, the person said.

The Sacklers would cede control of Purdue under the settlement terms discussed last week, the person said.

All the parties face a Friday deadline to update a federal judge on the status of the negotiations, the person said.

The company has said the U.S. Food and Drug Administration approved labels for OxyContin that warned about risk and abuse associated with treating pain. The Sacklers have argued they were passive board members who approved routine management requests rather than micromanaging the marketing of OxyContin.


The settlement offer was first reported by NBC. Paul Hanly, a lead attorney for the plaintiffs, in an email, replied only "Made up. Ridiculous," when asked to confirm NBC's report. Asked to clarify after Reuters confirmed the report, he did not respond.

Representatives for the Sackler family declined to comment and a representative for the state attorneys general did not immediately respond to a request for comment.

The plan under discussion envisions Purdue restructuring into a for-profit "public benefit trust" that would last for at least a decade, one of the people familiar with the matter said.

Purdue would contribute between $7 billion and $8 billion to the trust, with some of the money coming from the sales of its drugs, including those that combat opioid overdoses, the person said. Additional payments would come from the company's cash and insurance policies, the person said. Three experts would be approved by a bankruptcy judge as trustees who would select board members to run the trust, this person said.

The Sackler family, which has amassed an estimated $13 billion fortune over the years, is also weighing a possible sale of another pharmaceutical firm it owns called Mundipharma, with some of the proceeds potentially going toward the settlement under discussion, the person said. The settlement terms contemplate the Sacklers initially contributing $3 billion.

David Sackler, one of a handful of family members who previously sat on Purdue's board, has taken on a significant role in the recent discussions, which included at least 10 state attorneys general, the person said.

Purdue is set on Oct. 21, along with several other drug manufacturers and distributors, to face the first trial to result from federal court proceedings that have consolidated around 2,000 lawsuits brought largely by local governments accusing the companies of fueling the epidemic.

Other companies set to face trial include drugmakers Teva Pharmaceutical Industries (NYSE:TEVA) Ltd and Johnson & Johnson and drug distributors McKesson Corp (NYSE:MCK), Cardinal Health Inc (NYSE:CAH) and AmerisourceBergen (NYSE:ABC) Corp.

U.S. District Judge Dan Polster in Cleveland, Ohio, who oversees the lawsuits, has been pushing for settlements that could "do something meaningful to abate this crisis."

Purdue, the Sacklers and the communities involved face high-stakes negotiations and Purdue has been preparing for filing for bankruptcy protection in case it cannot reach an agreement.

Going into Chapter 11 would give Purdue the exclusive right for several months to propose a reorganization plan, which if approved by a U.S. bankruptcy judge could be forced on any local governments that decide to hold out.

Some state attorneys general have said they will resist any attempt by Purdue to use bankruptcy.

New York Attorney General Letitia James subpoenaed Wall Street banks, Purdue corporate entities and family offices in mid-August for records related to the Sackler family's finances, according to court records.

In a letter to a judge and an earlier lawsuit, her office characterized payouts to the Sacklers from Purdue as fraudulent conveyances, a legal designation for clawing back money during bankruptcy proceedings.

"The opioid epidemic has ravaged American communities for over a decade, while a single family has made billions profiting from death and destruction," James said in a statement. "We won’t let up until we have delivered justice.”

A lawyer representing the Sackler family said in a statement that the New York attorney general's "current claims are without merit and the subpoenas are improper."

Purdue Pharma in discussion on $10 billion-$12 billion offer to settle opioid lawsuits: sources

Related Articles

Apple, Microsoft, Alphabet Earnings: 3 Things to Watch
Apple, Microsoft, Alphabet Earnings: 3 Things to Watch By - Jul 26, 2021

By Dhirendra Tripathi -- Quarterly earnings take center stage this week, kicking off with Tesla Inc (NASDAQ:TSLA)’s results after the closing bell tonight. Investors...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email