OxyContin maker Purdue Pharma and its owners, the Sackler family, have agreed to pay $270 million to the state of Oklahoma to settle a lawsuit accusing the drugmaker of ruthlessly marketing and misleading the public about the dangers of its highly addictive narcotic.
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The case against Purdue and other manufacturers was scheduled to go to trial in May. Accusations against the Stamford, Connecticut-based company included downplaying the addiction risk of opioids while overstating the benefits.
The company previously denied any wrongdoing, saying labels for its painkiller carried warnings about the risk of abuse and misuse associated with the drugs.
At a news conference Tuesday confirming the settlement, Oklahoma Attorney General Mike Hunter said he intends to “hold accountable other defendants … for their role in creating the worst public health crisis in our state and nation we’ve ever seen.”
The settlement is just “the first step,” he added.
As a part of the agreement, unveiled Tuesday, Purdue will contribute $102.5 million to fund the creation of a National Center for Addiction Studies at Oklahoma State University. The company will also donate $20 million worth of medicines to support the center’s treatment mission.
The agreement, which resolves all of the state’s claims against Purdue, also includes an additional payment of $72.5 million, of which $12.5 million will be available to counties and cities in the state to abate the effects of the opioid crisis, the company said.
The Sacklers, who were not named as defendants in the lawsuit, will contribute $75 million toward the university center as well, Purdue added.
“Purdue is very pleased to have reached an agreement with Oklahoma that will help those who are battling addiction now and in the future,” Purdue Pharma CEO Craig Landau said in a statement. “We applaud Attorney General Mike Hunter for his leadership in making such an agreement possible.”
OxyContin is a prescription drug used to treat moderate to severe pain in adults. From 1999 to 2017, nearly 218,000 people have died in the United States from overdoses related to prescription opioids, according to the U.S. Centers for Disease Control and Prevention. OxyContin first came on the market in 1996.
The settlement Tuesday may take some pressure off Purdue, which has been considering bankruptcy protection.
Earlier this month, Landau said the company was considering bankruptcy to protect its assets against thousands of lawsuits for its alleged role in the opioid epidemic. Purdue was founded in the 1950s by brothers Arthur, Mortimer and Raymond Sackler.
–AP contributed to this report.
CNBC.com
