Topline
The Supreme Court temporarily blocked a $6 billion bankruptcy settlement Thursday that would’ve protected the company’s owners, the Sackler family, from civil lawsuits related to opioid abuse, and will hear the case in the fall, multiple news organizations reported.
The U.S. Supreme Court, pictured June 8, 2020, in Washington. (AP Photo/Manuel Balce Ceneta, File)
Key Facts
During the bankruptcy proceedings of Purdue Pharma, one of the drug companies widely considered to be responsible for the opioid epidemic, the Sackler family had agreed to pay $6 billion to settle opioid-related claims in exchange for immunity from future cases related to opioid abuse.
Thursday’s decision from the court temporarily pauses that deal and sets the stage for the issue to be debated in front of Supreme Court justices in December.
The question that will be debated centers around whether the bankruptcy court had the authority to approve such a deal, specifically whether it could shield the Sackler family from facing victims in court.
The challenge to the bankruptcy agreement was brought by the Department of Justice, which argued bankruptcy protections like the one in question should not be used to shield the Sacklers personally, according to the New York Times.
Key Background
Purdue Pharma made billions of dollars on its incredibly popular painkiller Oxycontin, which was first approved in December 1995. The company aggressively marketed the drugs while lying about its addictive qualities and harmful impacts, according to the conclusions of multiple government agencies and courts. In the early 2000s, reports of fatal overdoses from prescription drugs, particularly opioids, skyrocketed, with OxyContin at the center of the problem, according to the Food and Drug Administration. In 2007, the company pleaded guilty to misbranding the drug, but continued to sell and advertise it. However, investigations continued until the company once again pleaded guilty in 2020 to criminal charges including defrauding U.S. regulators and providing kickbacks to doctors who pushed the drug despite its dangers. The deal in which they plead guilty imposed roughly $8.3 billion of penalties on the company and opened the door to potentially thousands of civil lawsuits for victims, lawsuits that the Sackler family attempted to avoid liability for with the deal the Supreme Court Blocked Thursday.
Big Number
564,000. That’s how many deaths from opioid overdoses occurred between 1999 and 2020, according to the Centers for Disease Control and Prevention.
Further Reading
Supreme Court Pauses Opioid Settlement With Sacklers Pending Review (New York Times)
Supreme Court puts Purdue Pharma bankruptcy deal on hold (NBC News)
US Supreme Court Halts Purdue’s $6 Billion Opioid Pact, Will Hear Appeal (Bloomberg)
Source: https://www.forbes.com/sites/willskipworth/2023/08/10/supreme-court-temporarily-blocks-purdue-pharma-settlement-that-wouldve-protected-the-sackler-family-from-civil-lawsuits/