May 1 will be the first multibillion-dollar payment to address the ongoing damage from the overdose crisis.
West Allis Fire Demonstrates Narcan Use for Opioid Overdoses
West Allis Fire Department Deputy Chief Armando Suarez del Real explains how Narcan nasal spray kits are administered in the event of an overdose.
Purdue Pharma, the bankrupt drug company at the epicenter of the country’s longtime opioid epidemic, shut down on May 1.
The closure is part of a $7.4 billion agreement reached after the city of Purdue and the Sackler family, which privately owned the company, settled thousands of lawsuits brought by victims and multiple states seeking to address the harm caused by the drug. The Centers for Disease Control and Prevention estimated that between 1999 and 2023, about 806,000 people died from opioid overdoses, including prescription drugs such as Purdue’s OxyContin and illegal opioids, most notably fentanyl.
Purdue filed for bankruptcy in 2019, and its bankruptcy plan became effective May 1, about six months after a federal judge approved the settlement. The bankruptcy plan calls for Purdue to cease operations and create a new public benefit corporation called Knorr Pharma, run by a nonprofit foundation.
“Under the control of the Sackler family, Purdue developed, manufactured and misleadingly marketed deadly opioids that destroyed lives and communities across America,” New York State Attorney Letitia James (D) said in a statement. “This company, which has put profits before people for decades, has now shut down for good.”
The entire Sackler family is prohibited from selling opioids in the United States and has no role in Knorr, according to the New York State Attorney General’s Office. The New York State Attorney General’s Office, along with other state attorneys general, launched a multistate investigation into Purdue in 2016.
Purdue and the Sacklers are now ordered to pay billions of dollars for the fallout from the crisis after the Supreme Court threw out their initial settlement agreement in 2024.
The first round of payments, to be issued May 1, will require Purdue to pay about $900 million and the Sacklers to pay $1.5 billion, according to James’ office. Over the next few years, the Sacklers are required to pay approximately $1.4 billion through May 2029.
Missouri, which sued Purdue in 2017, will receive more than $91 million in settlements over the next 15 years. Valerie Huhn, director of the state Department of Mental Health, said in a statement that the settlement money is “critically important to support the public health response, including expanding treatment and prevention programs.”
Knorr plans to manufacture drugs containing opioids, but officials said the company would be subject to oversight by an independent monitor. The company cannot lobby or promote opioid products.
The company, which is organized as a nonprofit organization, is required to distribute excess revenue over operating costs to state, local and tribal governments to help reduce opioids. Knoa said in a news release that the initiative also includes efforts to provide free drugs to treat overdoses and to treat opioid use disorder.
“Knorr Pharma’s unique model ensures that the company’s resources directly support public health,” Dr. Paul Rothman, chairman of the Knorr Foundation Board of Directors, said in a statement, adding that the company is “committed to providing care and saving lives most affected by the opioid crisis.”
On April 28, a New Jersey federal court ordered Purdue to pay criminal penalties totaling more than $5 billion for fueling the opioid epidemic.
“Purdue Pharma put profits ahead of patient health and safety,” Acting U.S. Attorney Todd Blanche said in a statement.
U.S. authorities declared the opioid epidemic a public health emergency in 2017. Health research nonprofit KFF said overdose deaths increased prior to and during the COVID-19 pandemic, but have declined since mid-2023.
Eduardo Cuevas is based in New York City. Contact us via email (emcuevas1@usatoday.com) or Signal (emcuevas.01).
