Purdue Pharma Is Still “Fully” Operational Amid A Bankruptcy Dispute

In 1996, Purdue Pharma made about $44 million in OxyContin sales, a number that escalated to $3 billion (with over 14 million prescriptions dispensed) in 2001 and 2002 combined. The Sackler family-owned company spent roughly $200 million in 2001 alone, aggressively marketing the highly addictive opioid drug to physicians, claiming that a delayed-release mechanism could limit the risk of addiction. A fictionalized retelling of events, Netflix’s Painkiller portrays the origins and aftermath of America’s opioid crisis — which Purdue Pharma has been widely blamed for creating. Per the series, the crisis has resulted in over 300,000 overdose deaths over the past two decades.

Despite several investigations and lawsuits, however, the company still exists in 2023 — though not in the same form as the Netflix limited series showed. No member of the Sackler family has been criminally charged in connection with the marketing of OxyContin or any overdose deaths involving the drug. In March 2019, New York Attorney General Letitia James filed a lawsuit against opioid manufacturers, including Purdue Pharma and members of the Sackler family. With more than 2,600 federal and state lawsuits mounting, Purdue Pharma filed for Chapter 11 bankruptcy in September 2019.

James announced the suit’s resolution in July 2021, touting that the agreement will, “first and foremost, shut down Purdue Pharma and end the Sackler family’s ability to manufacture opioids ever again.” The lawsuit's resolution also requires the Sacklers to pay $4.5 billion, which primarily will go toward addiction treatment and prevention programs, over the next nine years.

Critics of the settlement disputed against the condition that largely absolves the Sacklers of Purdue’s opioid-related liability, according to The New York Times. U.S. Bankruptcy Court Judge Robert Drain approved the settlement in White Plains, N.Y. in September 2021, effectively ending thousands of lawsuits brought against the company by state and local governments, tribes, hospitals, and individuals in the wake of the deadly public health crisis. The Sacklers will remain one of the United States’ wealthiest families, per the NYT, with the Netflix series noting the family “is believed” to be worth over 11 billion dollars.

Though a lower court ruled in December 2021 that it was improper for Purdue Pharma’s bankruptcy deal to block future opioid-related lawsuits against the Sackler family, they filed an appeal. In May 2023, a federal appeals court in New York ruled in favor of Purdue Pharma’s bankruptcy plan, shielding the Sackler family from future lawsuits.

In August 2023, Purdue Pharma’s website noted that they “continue to operate fully,” offering prescription opioids, as well as laxatives, antiseptics, and dietary supplements through a subsidiary called Avrio Health. However, there are major changes ahead — including a new company name — as part of a post-bankruptcy restructuring plan. Per the company, once the plan, which delivers “billions of dollars of value for victim compensation, opioid crisis abatement, and overdose rescue medicines,” is complete, “Purdue Pharma will cease to exist and substantially all of Purdue’s assets will be transferred to a new company called Knoa Pharma.” While the company doesn’t have a specific timetable of when the change will take effect, the Sackler families will have no involvement in Knoa Pharma.

The bankruptcy case hit another roadblock on Aug. 10 when the United States Supreme Court blocked the reported $6 billion settlement that would have given the Sackler family immunity, per CNN. “We are confident in the legality of our nearly universally supported Plan of Reorganization, and optimistic that the Supreme Court will agree,” a Purdue Pharma rep said in a statement to the outlet. “Even so, we are disappointed that the US Trustee, despite having no concrete interest in the outcome of this process, has been able to single-handedly delay billions of dollars in value that should be put to use for victim compensation, opioid crisis abatement for communities across the country, and overdose rescue medicines.”

Solicitor General Elizabeth Prelogar argued in court papers that the Purdue settlement is “exceptional and unprecedented,” noting that the release “absolutely, unconditionally, irrevocably, fully, finally, forever and permanently releases the Sacklers from every conceivable type of opioid-related civil claim – even claims based on fraud and other forms of willful misconduct that could not be discharged if the Sacklers filed for bankruptcy in their individual capacities.”

In agreeing to pause the settlement, the court also said it would take up the case and hear arguments in December 2023.

If you or someone you know is seeking help for substance use, call the SAMHSA National Helpline at 1-800-662-HELP (4357).