Family will not settle unless released from current and future lawsuits
(AP) – Family members who own OxyContin maker Purdue Pharma will not contribute billions of dollars to a legal settlement unless they get rid of all pending and future lawsuits regarding the company’s operations. company, one of them said in court Tuesday in a rare public appearance.
David Sackler, grandson of one of the brothers who bought the company that would later become Purdue almost 70 years ago, testified at a hearing in federal bankruptcy court in White Plains, New York, that unless the settlement is approved with these protections included, as they are now: “I think we would litigate the claims until their final results”.
“We need sufficient discharge to achieve our goals,” Sackler said in response to questions from an attorney for the US bankruptcy trustee. “If the version fails to do that, we won’t support it. “
This is the crux of the argument over the family and business settlement plans, based in Stamford, Connecticut.
The Bankruptcy Trustee of the United States, nine states and the District of Columbia oppose the company’s settlement plan in large part because it would grant legal protection to members of the wealthy Sackler family, although none of between them does not declare bankruptcy.
The concept sparked protests, as well as federal legislation known as the SACKLER Act that would ban these deals, known as third party releases. They are granted by bankruptcy courts in some areas of the United States, but not all. The bill spat in Congress.
Lawsuits against the company and the Sacklers, including from several states, have been suspended since Purdue filed for bankruptcy nearly two years ago. If the reorganization is approved as is, it would freeze them forever. Members of the Sackler family are also seeking to protect themselves against future opioid lawsuits and any actions involving Purdue, even those unrelated to drugs.
The deal would not protect members of the Sackler family from any criminal charges. None have been reported against family members.
The Purdue reorganization plan has costs for members of the Sackler family. They would be required to relinquish ownership of the company, with future profits expected to ease the opioid crisis. They are also expected to contribute a total of $ 4.5 billion in cash and a charitable fund over time. This money is also intended for efforts to combat the crisis, with part going to the victims and their families.
But a report commissioned by a group of state attorneys general said that since most payments occur in years, family members could use the returns on investment and interest to build even more wealth while they make the payments. The assumptions in that report were attacked by an attorney for Sackler in Tuesday’s testimony.
The family’s collective wealth is estimated at nearly $ 11 billion, much of which comes from sales of OxyContin.
At Tuesday’s hearing, David Sackler, who served on the company’s board of directors from 2012 to 2018, was asked whether the family would come out with more money in a decade when his share would be refunded, than it currently has.
“I don’t think anyone can say that for sure,” he said.
The plan is that sales from other companies, primarily family-owned international pharmaceutical companies, would fund their payments in the settlement, he said.
Sackler, who also testified before a congressional committee late last year, stopped then and Tuesday to apologize for the role of family or business in the crisis of opioids, which has been linked to more than 500,000 deaths in the United States alone since 2000.
Because the company has marketed an opioid, said Sackler, “we have a moral responsibility to try to help, and that’s what this regulation is designed to do.”
He was then asked if the company was legally responsible for the opioid record. “We don’t believe our conduct was illegal in any way,” he said. “We want to help. “
Family members have long taken a low profile in business, but a public role in philanthropy. Amid protests over his role in the opioid trade, his name has been removed in recent years from the wings and galleries of institutions, including the Louvre in Paris. The Metropolitan Museum of Art in New York is examining the question.
When questioning Maryland Assistant Attorney General Brian Edmunds, Sackler said that when he joined the board of directors of his family’s business nearly ten years ago, he hoped that he would sell more ‘OxyContin would help solve the emerging crisis of drug addiction and overdose.
The company had just introduced a reformulated version of the potent pain reliever that was harder to handle to give users a faster high.
“This has been successful in reducing the incidence of nasal ingestion and abuse,” Sackler said. “The idea to increase sales was to take market share on non-deterrent products, thereby reducing abuse of the category and as a whole and reducing opioid overdoses.”
Instead, Purdue’s market share has shrunk. And opioid overdoses, increasingly caused by heroin and later by illicitly produced synthetic drugs like fentanyl, continued to increase.
Fatal opioid overdoses in the United States hit a record high of over 70,000 last year.
This story has been corrected to show that the US Bankruptcy Trustee was the only US Department of Justice office opposing the settlement, instead of two Department of Justice offices opposing it.
Copyright 2021 The Associated Press. All rights reserved.