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Purdue Pharma’s $12B Tentative Settlement Faces Push Back from State AG’s

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  • Purdue Pharma reached a potential $12 billion settlement with 23 states and more than 2,000 individual cases accusing the company of driving the country’s opioid crisis.
  • Under the details of the agreement, the company’s owners — the Sacklers —would need to pay $3 billion of the total, apply Purdue for bankruptcy, and dissolve the company.
  • A new company would then form, continuing to sell the painkiller OxyContin while also donating addiction treatment and overdose reversal drugs.

Tentative $12B Settlement

Purdue Pharma tentatively reached a massive settlement with more than 2,000 local governments after being sued for propagating by the United States’ opioid crisis, a move that will reportedly cost the company $12 billion dollars.

The settlement, agreed upon by 23 states, also stipulates that the owners of Purdue — the Sackler family — must relinquish their ownership and pay $3 billion of the grand total over a seven-year period. 

Forbes estimates the Sacklers net worth at $13 billion, but the family’s penalty might actually end up coming from the sale of their overseas pharmaceutical company Mundipharma. If, however, the Sacklers make more than $3 billion from the sale of Mundipharma, they could end up paying up to another $1.5 billion.

Purdue manufactures OxyContin, an opioid painkiller that many have claimed drove the opioid crisis the country currently faces. The conglomeration of lawsuits against Purdue seeks to hold the company accountable for hundreds of thousands of overdoses beginning in the mid-1990s.

Purdue would also be expected to file for Chapter 11 bankruptcy, effectively dissolving the company. That, in turn, would allow the formation of a new company that would continue to sell OxyContin and other medicine. Money made from those sales would then help pay alleged victims from the lawsuits.

Additionally, Purdue would donate addiction treatment and overdose reversal drugs.

“Purdue Pharma continues to work with all plaintiffs on reaching a comprehensive resolution to its opioid litigation that will deliver billions of dollars and vital opioid overdose rescue medicines to communities across the country impacted by the opioid crisis,” the company said in a statement.

Notably, the settlement allows Purdue to avoid publishing an admission of wrongdoing. 

The agreement, however, is not finalized. The company’s board must still agree to the settlement, and a bankruptcy court judge must also approve it.

If the settlement goes through, Purdue will avoid an upcoming October trial in Cleveland, which would be the first federal trial involving a company potentially being held accountable for the opioid epidemic. Attorneys who support the agreement said it is a better solution than a long trial that might not yield better results. 

In August, Johnson & Johnson became the first pharmaceutical company to lose a lawsuit concerning the opioid crisis when it was forced to pay $572 million to the state of Oklahoma. Purdue was also implicated in the same lawsuit, but it settled with Oklahoma to pay $270 million. 

In 2007, the company and three executives were forced to shell out $635 million after pleading guilty to lying to doctors and the public about OxyContin’s safety. 

Response From States

While the settlement would push a large sum across the country, more than half of the states’ attorneys general criticized the tentative settlement, arguing the amount to be paid does not offset the amount governments have spent and will need to spend to fight the opioid crisis. 

It comes in spite of the executive committee of lawyers representing all of the cases recommended states accept the deal. 

Because of their response, that has led some commentators to question whether or not a bankruptcy judge will accept the proposal. Now, some of those state attorneys general — including those for Virginia, North Carolina, and Delaware — said they will go after the Sacklers directly.

“These people are among the most responsible for the trail of death and destruction the opioid epidemic has left in its wake,” North Carolina Attorney General Josh Stein said of the Sackler family. 

Several Democratic presidential hopefuls have suggested taking criminal action against either the company or potentially the Sacklers through proposed legislation.

“If no Sacklers end up behind bars, an entire class of people will continue to feel that writing a check is the worst thing that will happen to them ever no [matter] what they do,” Keith Humphreys, a drug policy expert at Stanford, said.

In a statement, the family said it “supports working toward a global resolution that directs resources to the patients, families and communities across the country who are suffering and need assistance. This is the most effective way to address the urgency of the current public health crisis and to fund real solutions, not endless litigation.”

Other attorneys representing various states called the agreement a win and “historic.” 

“Sadly, this agreement cannot bring back those who have lost their lives to opioid abuse,” Ashley Moody, the state attorney general for Florida, said, “but it will help Florida gain access to more life-saving resources and bolster our efforts to end this deadly epidemic.”

See what others are saying: (New York Times) (CNN) (Washington Post)

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New COVID-19 Variant Could Become Dominant in the U.S. by March, CDC Warns

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  • The CDC warned Friday that a new highly transmissible COVID-19 variant could become the predominant variant in the United States by March.
  • The strain was first reported in the United Kingdom in December and is now in at least 10 states.
  • The CDC used a modeled trajectory to discover how quickly the variant could spread in the U.S. and said that this could threaten the country’s already overwhelmed healthcare system.

CDC Issues Warning

The Centers for Disease Control and Prevention warned Friday that the new COVID-19 variant could become the predominant variant in the United States by March.

While it is not known to be more deadly, it does spread at a higher rate, which is troubling considering the condition the U.S. is already in. Cases and deaths are already on the rise in nearly every state and globally, 2 million lives have been lost to the coronavirus. 

The variant was first reported in the United Kingdom in mid-December. It is now in 30 countries, including the U.S., where cases have been located in at least ten states. Right now, only 76 cases of this variant have been confirmed in the U.S., but experts believe that number is likely much higher and said it will increase significantly in the coming weeks. It is already a dominant strain in parts of the U.K.

Modeled trajectory shows that growth in the U.S. could be so fast that it dominates U.S. cases just three months into the new year. This could pose a huge threat to our already strained healthcare system.

Mitigating Spread of Variant

“I want to stress that we are deeply concerned that this strain is more transmissible and can accelerate outbreaks in the U.S. in the coming weeks,” said Dr. Jay Butler, deputy director for infectious diseases at the CDC told the New York Times. “We’re sounding the alarm and urging people to realize the pandemic is not over and in no way is it time to throw in the towel.”

The CDC advises that health officials use this time to limit spread and increase vaccination as much as possible in order to mitigate the impact this variant will have. Experts believe that current vaccines will protect against this strain.

“Effective public health measures, including vaccination, physical distancing, use of masks, hand hygiene, and isolation and quarantine, will be essential,” the CDC said in their report.

“Strategic testing of persons without symptoms but at higher risk of infection, such as those exposed to SARS-CoV-2 or who have frequent unavoidable contact with the public, provides another opportunity to limit ongoing spread.”

See what others are saying: (Wall Street Journal) (New York Times) (NBC News)

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Former Michigan Gov. and 8 Others Charged Over Flint Water Crisis

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Michigan Gov. Rick Snyder. (Al Goldis/AP)

  • Ex-Michigan Gov. Rick Snyder was charged with two counts of willful neglect of duty Wednesday for his role in the Flint water crisis
  • By Thursday, eight more former state and city officials were charged with crimes ranging from involuntary manslaughter to extortion.
  • Flint residents have long awaited this news. In 2019, prosecutors dropped all criminal charges against 15 officials and said they would start the investigation from scratch, citing concerns about how the special counsel had conducted its probe.

Rick Snyder Charges

Michigan Attorney General Dana Nessel’s office said Thursday that it had filed 41 charges against nine former state and city officials for their role in the Flint water crisis.

The most high-profile figure to be charged was former Michigan Gov. Rick Snyder. On Wednesday, he was hit with two counts of willful neglect of duty.

He was the state’s top executive when local officials decided to switch the city’s drinking water source to the Flint River in 2014.

The switch was supposed to be a temporary cost-saving measure while a pipeline was being built to Lake Huron. However, the water wasn’t treated properly for corrosion, so lead-contaminated water was released into the homes of people all over the city. Because of that, 12 people died and at least 90 were sickened with Legionnaires’ disease.

Snyder appeared in court this morning via Zoom, pleading not guilty to the two misdemeanor charges. If convicted he could face up to a year in prison and as much as a $1,000 fine.

His charges alone are significant because they make him the first governor or former governor in the state to ever be charged with a crime for alleged conduct while in office.

8 Others Charged

Along with Snyder, eight others were charged, including a former state health director Nick Lyon. Lyon received nine charges of involuntary manslaughter, among others.

Richard Baird, one of Snyder’s closes advisors was changed for extortion, perjury, and obstructions of justice. Others who were charged include:

  • Jarrod Agen, Snyder’s former chief of staff and Vice President Mike Pence’s former communications director.
  • Dr. Eden Wells, a former chief medical executive for the state Department of Health and Human Services. 
  • Darnell Earley, former Flint finance director and state-appointed emergency manager.
  • Gerald Ambrose, former state-appointed emergency manager.
  • Howard Croft, former Flint Public Works Director.
  • Nancy Peeler, the state’s director of maternal, infant and early childhood home visiting for the health department.

Flint residents have waited a long time for justice over the water contamination issue. Prosecutors previously dropped all 15 criminal charges tied to the Flint case in 2019 and said the investigation would begin again from scratch.

At the time, they cited concerns about how the special counsel had conducted its probe.

It also wasn’t until last year that the state reached a $600 million settlement with victims, establishing a fund from which residents can file for compensation.

See what others are saying: (NPR) (The Detroit News) (Detroit Free Press)

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Three Lawmakers Test Positive for COVID-19 Following Capitol Attack

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  • At least three Congressmembers have tested positive for COVID-19 following Wednesday’s pro-Trump attack on the Capitol. 
  • Rep. Bonnie Watson Coleman (D-NJ), Rep. Pramila Jayapal (D-Wash.), and Rep. Brad Schneider (D-Ill.) believe they contracted the virus after locking down in close quarters with numerous Republican lawmakers who refused to wear masks.
  • Jayapal and Schneider are calling for those who did not wear a mask to face consequences.

Rep. Bonnie Watson Coleman Tests Positive

At least three members of Congress have tested positive for COVID-19 after locking down in close quarters with other House members during Wednesday’s pro-Trump attack on the Capitol. 

Congress’ attending physician, Brian Monahan, warned that members may have been exposed during the lockdown. He recommended that everyone who was isolated inside should get tested for the virus. 

On Monday Rep. Bonnie Watson Coleman (D-NJ) became the first to announce that she tested positive. Watson Coleman believes she was exposed while in the Capitol lockdown. In her statement, she cited the multiple Republicans who refused to wear masks while inside. Video footage from Punchbowl News shows a Democratic lawmaker handing out masks and a handful of Republicans declining to take one. 

Watson Coleman is a 75-year-old lung cancer survivor. While she said she is only experiencing cold-like symptoms, she tweeted that per a doctor’s suggestion, she headed to a local hospital for antibody treatment. She also encouraged those who sheltered in place to get tested. 

More Cases Follow

Later on Monday, Rep. Pramila Jayapal (D-Wash.) said she too had tested positive, also blaming a lack of mask-wearing in the Capitol. In a lengthy Twitter thread, she said Republicans created a superspreader event and demanded consequences for their actions. 

Many Republicans still refused to take the bare minimum COVID-19 precaution and simply wear a damn mask in a crowded room during a pandemic—creating a superspreader event ON TOP of a domestic terrorist attack,” she wrote. 

“Any Member who refuses to wear a mask should be fully held accountable,” Jayapal added. 

“I’m calling for every single Member who refuses to wear a mask in the Capitol to be fined and removed from the floor by the Sergeant at Arms.”

Rep. Brad Schneider (D-Ill.) echoed her frustrations on Tuesday after releasing a statement saying he has become the third House member to have tested positive following the lockdown. 

“Today, I am now in strict isolation, worried that I have risked my wife’s health and angry at the selfishness and arrogance of the anti-maskers who put their own contempt and disregard for decency ahead of the health and safety of their colleagues and our staff,” he wrote.

Like Jayapal, he is calling for sanctions against those who opted to not wear masks. 

Many health officials feared that this lockdown could lead to a surge in cases. They also worry that the mob itself could lead to a superspreader event as most of those who attacked the Capitol were not wearing masks and were crowding together both inside and outside of the building.

See what others are saying: (The Washington Post) (NPR) (NBC Chicago)

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