Purdue Pharma / OxyContin Opioid Bankruptcy & Victims Settlement

Purdue Pharma L.P., the Connecticut-based maker of OxyContin, filed for Chapter 11 bankruptcy protection in September 2019 as it faced roughly 2,600 lawsuits from state and local governments, hospitals, Native American tribes, and individual victims alleging the company had deceptively marketed OxyContin as less addictive and more effective than competing opioids. Internal documents revealed that Purdue executives were aware of the drug's devastating abuse potential as early as the late 1990s but continued aggressive marketing tactics, including paying doctors kickbacks disguised as consulting fees and downplaying addiction risks to prescribers. The Sackler family, which owned Purdue privately, withdrew more than $10 billion from the company in the years before its bankruptcy filing.

A settlement framework negotiated in bankruptcy court required Purdue to be dissolved and reorganized into a new public benefit company with all profits directed to opioid abatement, while the Sackler family agreed to pay up to $6 billion over time — reduced from an earlier $4.5 billion proposal following U.S. Supreme Court intervention in 2023. The Supreme Court's landmark June 2024 ruling in Harrington v. Purdue Pharma (5-4) struck down the portion of the bankruptcy plan that provided the Sackler family with broad legal immunity from civil opioid lawsuits without their filing for personal bankruptcy, sending the parties back to renegotiate. The case remains one of the most closely watched mass tort bankruptcies in U.S. history.