The maker of OxyContin could pay as much as $12 billion spread over time between dozens of states and 2,000 municipalities nationwide, including several in Mississippi, as part of a tentative settlement announced last week.
Purdue Pharma took the first step in the plan on Sunday, filing for a structured bankruptcy that would allow the company to continue to operate but as a “public benefit trust.” The Sackler family that owns the opioid maker would have to give up control of the company and contribute at least $3 billion toward the settlement, The Associated Press has reported.
Thousands of municipalities nationwide have filed lawsuits that detail the history of the highly potent painkillers, dating to the 1990s, and what they allege are sales practices that sought increased profits by knowingly fueling addictions. The lawsuits say that the damages suffered by the municipalities include costs for providing medical care and rehabilitation services for drug addicts; caring for infants born with opioid-related medical conditions and children whose parents are addicts; and increased law enforcement costs relating to the opioid epidemic.
All the cases were consolidated under one federal judge in Ohio. The first trial in the case was scheduled to begin next month, which put pressure to reach a settlement quickly.
The AP said it’s not clear how any money from the settlement would be divided between the entities.
Also, the settlement is not final and could change drastically before reaching its ultimate form. The possible deal between the municipalities and Purdue Pharma was brokered by attorneys general from some states, but other states want to continue fighting to try and force the company to pay more. They argue, among other things, that it’s unconscionable for those suing Purdue Pharma for its allegedly deceptive marketing practices to allow the company to keep peddling painkillers, and potentially addicting new users, in order to generate the money to pay off the settlement.
The proposed settlement’s terms are indeed ironic, but we’ve been there before. The massive settlement against Big Tobacco in the late 1990s was predicated on keeping the cigarette makers in business so that they could generate the profits to fork out money every year to the 46 states, the District of Columbia and the five U.S. territories that sued the cigarette makers.
In the Purdue Pharma litigation, the states and municipalities should be content with what’s been offered, since those who have abused prescription drugs also bear some responsibility for their problems. Their habit hasn’t just harmed them either. It’s also resulted in restricting the use of these drugs for patients who had valid prescriptions and consumed just the recommended amounts to control pain, for which these drugs are remarkably effective.
Certainly, Purdue Pharma and the drugmakers are not guiltless. Morphine — which is a natural opioid — has long been heavily restricted because its addictive properties are so well-known. The pharmaceutical companies came up with a way to make painkillers in the lab that were just as effective, but they intentionally soft-pedaled their products’ addictive properties. They pushed a false narrative that OxyContin and other similar drugs were safe alternatives to morphine. They encouraged physicians to increasingly prescribe them for chronic pain, leading to the huge public health crisis, even though they clearly knew or should have known how addictive the painkillers are. They should pay up as a result of their chase for profits at the expense of the public good.
The sooner the case is settled, though, the better equipped state and local governments will be to fight the problems caused by opioids, assuming they use the settlement funds for treating addicts and dealing with the collateral damage of addiction rather than to patch their budget holes.