April 13, 2020

Opioid Settlements: Some Lessons Learned from Big Tobacco

By Lynn M. Barrett, Esq., CHC, CCP, Barrett Law, PA, Weston, FL

Proposed Opioid Settlement: Purdue Pharma

In September 2019, Purdue Pharma (Purdue) announced its agreement in principle on a framework for a “landmark” opioid litigation settlement worth, by Purdue’s account, an estimated $10 billion.1 As proposed, the agreement would settle claims brought by 24 attorneys general, five U.S. territories and the Plaintiffs’ Executive Committee2 in the opioid Multidistrict Litigation (MDL). Allegations in the thousands of lawsuits that are part of the MDL as well as state litigation include claims that Purdue fueled the opioid crisis by, among other things, overstating the benefits and grossly misrepresenting the risks of the long-term use of prescription opioids for chronic pain.3 The proposed agreement came as Purdue filed for Chapter 11 bankruptcy protection, which would be a “next step in implementing this historic agreement in principle.”4 Pursuant to the agreement, the Sacklers, owners of Purdue, would contribute all of Purdue’s assets to a public trust or other entity established for the benefit of the claimants “and the American people.” The Board of Directors would be selected by the claimants and subject to the approval of the bankruptcy court, and the trust or other entity would potentially contribute tens of millions of doses of opioid overdose reversal and addiction treatment medications at low or no cost. In addition, the Sacklers would also personally contribute at least $3 billion as part of this plan. 

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