Purdue Pharma, manufacturer of the painkiller OxyContin, has reached a tentative settlement with 22 states and more than 2,000 localities that sued the company over its role in the opioid crisis of the past two decades, people close to the deal said Wednesday.
Virginia Attorney General Mark Herring on Wednesday morning announced that he had added the Sackler family — owners of Purdue Pharma — to the state’s lawsuit. In a statement Wednesday evening, Herring said that he hadn’t agreed to the settlement and “won’t unless and until I am sure it is in the best interest of Virginians.”
“Purdue and the Sacklers will never be able to undo all the damage they have done, but at the very least, they must face real, significant, personal accountability for their lies and for the pain and heartbreak they have caused,” he added.
The executive committee of lawyers representing cities, counties and other groups in a federal lawsuit against Purdue and other drug companies is recommending the deal be accepted. But some state attorneys general, who sued Purdue and the Sacklers in state courts, are still opposed to a deal.
Under terms of a plan negotiated for months, the Sacklers would relinquish control of Purdue, based in Stamford, Conn. The company would declare bankruptcy and become a trust whose main purpose would be to combat the opioid epidemic.
If the deal becomes final, it would be the first comprehensive settlement in the broad legal effort to hold drug companies accountable for their role in the epidemic. To date, Purdue has also settled with one state, Oklahoma, for $270 million, and won a victory when a North Dakota judge threw out the state case against the company.
The deal also would mark the end of Purdue, the company widely blamed for its role in driving the prescription opioid epidemic as it spread in the late 1990s and the first years of this century.
In 2007, Purdue and three of its executives pleaded guilty to criminal charges of misleading doctors and the public about the safety of OxyContin and paid a $635 million fine.
On Wednesday, the divide over the settlement broke down largely along party lines, with most Republican attorneys general in favor of it and Democrats largely opposed.
Pennsylvania Attorney General Josh Shapiro, a Democrat who tried to negotiate a settlement he could accept, opposes the final deal and has said he will sue the Sacklers personally. Another Democratic opponent, North Carolina Attorney General Josh Stein, said Wednesday that he would do the same.
But Ohio Attorney General Dave Yost, a Republican, backs the agreement. “The proposed settlement with Purdue provides the greatest certainty for all Ohioans to receive relief as quickly as possible in light of rumored bankruptcy,” said a spokeswoman for Yost.
The deal was said to be worth $10 billion to $12 billion, including a $3 billion payment from the Sacklers. It also would include at least $1.5 billion from the sale of the family’s international drug conglomerate, Mundipharma, according to documents and people close to the talks.
The federal plaintiffs and many attorneys general apparently felt the proposal was as good as they could get.
The lawyers for the cities and counties agreed to recommend that the municipalities “move forward in support of the current proposal, subject to satisfactory documentation of the essential terms and final documents,” said Paul Hanly Jr., Paul Farrell Jr. and Joseph Rice, three of the leaders of that group. “We feel good progress has and will continue to be made.”
But some states objected that the Sacklers were not contributing enough cash from their personal fortunes, built almost entirely on the sale of OxyContin and taken out of the company in recent years, according to court papers filed by some states.
Another major concern is that the deal relies significantly on the assumed value of Purdue’s assets and the sale of a subsidiary. States opposing it fear these values may be overestimated, and some settlement money may never materialize.
It was not clear Wednesday whether the Sacklers had agreed to increase their personal contribution to the settlement or whether other terms had changed.
Pending is the mammoth federal case in Cleveland against other drug companies, known as a “multidistrict litigation” or MDL, where the lawsuits from cities, counties, Indian tribes, hospitals and other groups have been consolidated.