Purdue Pharma Tentatively Settles Thousands of Opioid Cases

A critical sticking point has been the timing of the family’s sale of its global pharmaceutical business, Mundipharma, and the contribution the family would make from the proceeds. Some attorneys general, including those from Massachusetts, New York, New Jersey, Pennsylvania and Connecticut, who have not signed on to the settlement, had been pressing the family to sell Mundipharma immediately and to discontinue manufacturing drugs for international markets. In addition, the attorneys general said, they wanted the Sacklers to commit an additional $1.5 billion up front.

The family rejected those terms.

The attorneys general for several states vowed to push on. Letitia James, New York’s attorney general, called the deal “an insult, plain and simple.” Gurbir S. Grewal, New Jersey’s attorney general, said, “If Purdue cannot pay for the harm it inflicted, the Sacklers will.” And Josh Shapiro, Pennsylvania’s attorney general, who also did not support the deal, said his office was now preparing to sue the Sacklers.

Maura Healey, the Massachusetts attorney general, who was the first to sue members of the Sackler family, said in a statement, “It’s critical that all the facts come out about what this company and its executives and directors did, that they apologize for the harm they caused, and that no one profits from breaking the law.”

William Tong, Connecticut’s attorney general, said in a statement “I cannot predict whether Purdue will seek bankruptcy, but all I can say is we are ready to aggressively pursue this case wherever it goes — whether it is in the Connecticut courts or through bankruptcy.”

Often when a company goes into Chapter 11 bankruptcy, all litigation against it is stayed. The deconstruction and evolution of Purdue would be overseen by a bankruptcy judge and, eventually, trustees appointed to assemble a new, transparent board, which would not include any of the Sacklers.

Still unclear is what the distribution of any Purdue and Sackler money would look like for individual parties that have signed on to the deal, as well as for the federal government, which has been investigating the company. Hospitals, insurers and a group representing infants born exposed to opioids have also brought lawsuits.

Another significant question to be resolved is where, legally and practically, the settlement would leave the Sacklers. Whether they would be legally insulated by the settlement is in dispute.