Purdue’s Sacklers Boost Opioid Settlement Offer Up to $6 Billion

Members of the billionaire Sackler family that own Purdue Pharma LP have offered to pay as much as $6 billion to revive the OxyContin maker’s imperiled opioid settlement, a more-than $1 billion increase from their existing proposal.

The new settlement offer would see the Sackler family pay at least $5.5 billion, with additional money contingent on certain asset sales, a court appointed mediator, U.S. Bankruptcy Judge Shelley Chapman, said in a report Friday. A final deal hasn’t been reached, according to the mediator.

The Sacklers and a handful of state attorneys general have been in mediation for the past two months, after a New York judge rejected an earlier deal negotiated as part of the company’s bankruptcy. That settlement would have resolved trillions of dollars in claims by state and local governments over the company’s role in the opioid crisis and give Sackler family members broad immunity from future lawsuits.

As part of the deal, Purdue will hand over nearly all of its assets to the states, cities and counties that are suing the drugmaker over its handling of the pain killer OxyContin. Billions of dollars also would be provided to fund anti-addiction programs.

But the plan to give Purdue’s owners immunity from future opioid lawsuits has been a sticking point, drawing the ire of some states and local politicians. Attorneys general from eight states and the District of Columbia, along with an arm of the U.S. Justice Department, succeeded in having the settlement overturned on appeal after Purdue’s bankruptcy judge approved it last year.

More Support

Most, but not all, of the dissenting states have agreed to the new settlement offer, according to mediator’s report. The Sacklers’ offer is contingent on unanimous support, the report says.

“We remain focused on achieving our goal of providing urgently needed funds to the American people for opioid crisis abatement,” Michele Sharp, a Purdue spokeswoman, said in an email. “We believe a global settlement is the swiftest and most cost-effective exit path from Chapter 11 and we will continue working to build consensus as we proceed through the appeal process with the United States Court of Appeals for the Second Circuit.”

Connecticut Attorney General William Tong, who was among those who opposed the earlier offer, declined to comment Friday on the mediator’s report. Representatives of Maryland Attorney General Brian Frosh didn’t immediately return an email seeking comment.

Representatives for the Mortimer Sackler and Raymond Sackler wings of the family didn’t immediately respond to requests for comment.

Chapman requested the court-ordered mediation be extended to Feb. 28. The previous order lapsed on Wednesday.

The bankruptcy case is Purdue Pharma LP, 19-23649, U.S. Bankruptcy Court for the Southern District of New York (White Plains).

(Adds details of state support, mediation extension beginning in paragraph seven.)

To contact the reporters on this story:
Jeremy Hill in New York at jhill273@bloomberg.net;
Jef Feeley in Wilmington, Delaware at jfeeley@bloomberg.net

To contact the editors responsible for this story:
Claire Boston at cboston6@bloomberg.net

Steve Stroth

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