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Massachusetts Part Of Purdue Pharma Resolution

Massachusetts Attorney General Maura Healey announces a settlement that resolves Massachusetts' lawsuit against Purdue Pharma at a press conference Thursday afternoon.
Chris Van Buskirk
State House News Service
Massachusetts Attorney General Maura Healey announces a settlement that resolves Massachusetts' lawsuit against Purdue Pharma at a press conference Thursday afternoon.

After holding out for almost two years and securing additional commitments, Massachusetts Attorney General Maura Healey and her counterparts in 14 other states agreed this week to resolve their lawsuits against OxyContin manufacturer Purdue Pharma as part of a deal in which Massachusetts is expected to get $90 million to combat the ongoing opioid crisis.

Healey, who filed the first state lawsuit against individual members of the OxyContin maker's controlling Sackler family, said the agreement requires Purdue to be wound down by 2024, bans the Sacklers from the opioid business and orders more than 30 million documents related to opioid sales, marketing and distribution to be made public. The attorney general described the document requirement as the "most significant disclosure in any case ever."

The Sackler family is also to pay more than $4.3 billion over nine years, including $90 million for Massachusetts and additional compensation for families and victims here. Healey said the amount that will be extracted from the Sacklers is "the most that individuals have ever paid for breaking the law" and that all of it will go towards addiction prevention, treatment and education.

"While I know this resolution does not bring back loved ones or undo the evil of what the Sacklers did, forcing them to turn over their secrets by providing all the documents, forcing them to repay billions, forcing the Sacklers out of the opioid business, and shutting down Purdue will help stop anything like this from ever happening again," the attorney general said. "This case has also shown us that our legal system needs to change so that billionaires are never allowed to manipulate the bankruptcy system. I am grateful to the families whose strength and perseverance will continue to guide our work to combat this crisis in the years ahead."

Healey's office said the resolution was filed in bankruptcy court Wednesday night and is subject to approval. A confirmation hearing on the broader Purdue bankruptcy organization plan is scheduled for Aug. 9, and Healey suggested that she and other attorneys general decided it was time to settle rather than risk having a plan that did not address their priorities be approved.

"Our job as AGs was to look at what our families needed and deserve. We listened to our families and we made the decision to deliver on our promise to our families for disclosure," she said. "They wanted full disclosure, transparency, a light shone, the secrets to be told, everything to come out. That's what we were able to achieve through the process and that is what, for me, made me make the decision to take this and improve the plan and not risk not having that important component established, transparency and disclosure."

If the organization plan is certified, it will shield Sackler family members from further opioid-related lawsuits, including the state case Healey filed in Massachusetts, she said, eliminating that avenue as an alternative to a settlement.

During a press conference in Healey's office Thursday afternoon, Gov. Charlie Baker said Healey, who has for years been viewed as a possible challenger to Baker should he seek a third term in 2022, made the right decision to reject the earlier offer and hold out for more.

"It took tremendous courage on the part of the attorney general and her staff to say no to that deal," Baker said. "It was at one of those moments when all the momentum and all the push that's coming from the people who are quote-unquote on your team is to just get this done. She and her team looked at the deal and said, basically, 'not enough.' And they were right and they forced people back to the table. And I'm sure they made a lot of people unhappy when they did it, but it was absolutely the right thing to do."

The governor added, "By taking the heat and not closing the books on this, they got a deal that's far more appropriate -- not everything, but far more appropriate -- given the wreckage that was created by that organization."

In 2019, when Purdue filed for Chapter 11 bankruptcy protection and announced that it had agreed to a roughly $10 billion settlement with 24 state attorneys general, Healey opposed the settlement as "incomplete" without the Sacklers putting up some of their own personal fortunes.

"I rejected it for the following reasons: first of all, this proposed deal isn't worth nearly what they say it is. It doesn't require the Sacklers to pay back a dime of the billions of dollars they sucked out of Purdue through the sales of Oxy over the last many years. And also it doesn't provide the kind of accountability and transparency that we need," Healey said almost two years ago. "We need the documents, we need the story told. That's the only way we're going to get justice in this case."

Under that outdated 2019 proposal, Purdue Pharma was to be reorganized through the bankruptcy process as a public beneficiary trust with $7 billion from Purdue, including some in the form of future proceeds from the sale of OxyContin, and a minimum of $3 billion from the Sackler family. Healey said she and other attorneys general thought the idea of a settlement funded through continued sales of OxyContin was "so offensive and abhorrent" that they fought it.

"This is something that changed materially from where negotiations were two years ago," Healey said Thursday. "Purdue is being wound down. Purdue will cease to exist as of 2024."

Under the latest bankruptcy plan, the New York Times reported Thursday, Purdue would be turned into a new company overseen by an appointed board that would produce "limited quantities" of OxyContin and overdose reversal drugs with its profits supporting drug treatment and prevention programs.

Minnesota Attorney General Keith Ellison, who joined Healey and New York Attorney General Letitia James for a virtual press conference Thursday morning, said the Purdue plan is better for all involved because of the efforts of his state, Massachusetts, New York and the others that held out for more.

"We increased the deal from around $3 billion to about $4.325 billion today, so it is a substantial increase over what we rejected a couple of years ago," he said, referring to the Sackler family's contributions. The family will also pay $225 million in a civil settlement with the U.S. Department of Justice.

All three attorneys general agreed that while the resolution they announced Thursday may be the best they could achieve, it is not enough.

"Clearly, no one is happy with the settlement," James said. "Can the Sacklers do more? Hell yeah, they can do a lot better. But it should first begin with an apology."

California, Connecticut, Delaware, Maryland, New Hampshire, Oregon, Pennsylvania, Vermont, Washington, and Washington, D.C. continue to oppose the agreement, but Healey suggested Thursday that some of those jurisdictions might drop their opposition in the coming weeks.

The roughly $90 million that would come to Massachusetts under the agreement would be deposited into the Opioid Recovery and Remediation Trust Fund that was created in the fiscal year 2020 closeout budget "to mitigate the impacts of the opioid epidemic," by expanding access to opioid use disorder prevention, intervention, and recovery options.

The funds "shall supplement and shall not replace existing local, state, private or federal funding" and will be distributed by the state's health and human services secretary working with the Opioid Recovery and Remediation Trust Fund Advisory Council.

"This is a remediation fund that has an advisory board of affected families and individuals, experts in the space. They have tabula rasa here, they're in a position where they can create an approach to things that typically can't get funded to a traditional medical approach, or things that don't get funded through the way we handle residential services currently, or things that we typically don't put money into that have to do with prevention, or they can augment stuff we do in certain areas where people raise issues about whether we have enough," Baker said. He added, "They have far wider flexibility to figure out how they can be most effective than you typically have."

Massachusetts opioid overdose deaths rose by 5 percent to a new high in 2020, the first year-over-year increase in overdose deaths here in three years. The Department of Public Health reported last month that 2,035 people died of confirmed overdose deaths in Massachusetts last year and that predictive modeling suggests there will be another 66 to 70 deaths confirmed once additional cases are finalized.

Healey first sued the Sackler family and Purdue Pharma in June 2018, alleging that they "engaged in a deadly, deceptive scheme to sell opioids in Massachusetts" and profited from the drug epidemic they helped create.

Healey's complaint alleged that Purdue "created the epidemic and profited from it through a web of illegal deceit" by misleading doctors and patients to get more people using their drugs, at "higher and more dangerous doses" and for longer periods of time, as well as by deploying falsehoods to keep patients away from "safer alternatives."