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OxyContin’s long-acting formulation makes it popular but also prone to abuse. Source: Toby Talbot/AP.
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  • The Sackler family — owner of the OxyContin maker Purdue Pharma — is expected to fork out almost US$4.3 billion (roughly A$5.56 billion) to resolve thousands of settlements
  • The settlement is part of a bankruptcy plan that Purdue filed on Monday, which would restructure the company into an entity that would steer profits to the plaintiffs
  • The plan sets up trusts that would indirectly control the new entity and the distribution of money to states and local governments
  • A board consisting of independent managers selected by states and local governments will oversee the new entity, which will not promote opioid products to healthcare providers
  • The opioid crisis has claimed almost 450,000 lives in the United States between 1999 and 2018

The Sackler family — owner of the OxyContin maker Purdue Pharma — is expected to fork out almost US$4.3 billion (roughly A$5.56 billion) to resolve thousands of settlements.

The settlement is part of a bankruptcy plan that Purdue filed on Monday, which would restructure the company into an entity that would steer profits to the plaintiffs.

The plan is intended to serve as roadmap for Purdue out of bankruptcy, which came in September 2019 in the face of nearly 3000 lawsuits accusing the drug maker of fuelling America’s opioid crisis through deceptive marketing.

Worth more than US$10 billion (roughly A$12.93 billion), the plan sets up trusts that would indirectly control the new entity and the distribution of money to states, local governments and tribal organisations for opioid abatement programs.

The Sackler family’s commitment, which is significantly more than an earlier US$3 billion (roughly A$3.88 billion) settlement, will be paid out over nine years.

“With drug overdoses still at record levels, it is past time to put Purdue’s assets to work addressing the crisis,” Purdue’s Chairman Steve Miller said in a statement.

“We are confident this plan achieves that critical goal.”

In addition to the Sacklers’ contribution proceeds from insurance policies, the trusts will be funded with an initial cash injection of US$500 million (roughly A$646.41 million) immediately after the company emerges from bankruptcy.

A further US$1 billion (roughly A$1.29 billion) will be generated from the new entity’s assets and operations through 2024.

A board consisting of independent managers selected by states and local governments — in consultation with Purdue and its unsecured creditors’ committee — will oversee the new entity, which will not promote opioid products to healthcare providers.

The Sacklers will not be part of the board selection process.

“The Sacklers became billionaires by causing a national tragedy. Now they’re trying to get away with it,” said Massachusetts Attorney General Maura Healey.

“We’re going to keep fighting for the accountability that families all across this country deserve.”

According to the U.S. Centres for Disease Control and Prevention, the opioid crisis has claimed almost 450,000 lives in the United States between 1999 and 2018.

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