Amid Opioid Crisis, Sackler Family Pocketed Billions, Court Audit Shows
STEVE INSKEEP, HOST:
How much did the Sackler family profit before it surrendered Purdue Pharma? The family put the maker of Oxycontin into bankruptcy, part of a settlement over the opioid crisis. But an audit now shows the profits the Sacklers took beforehand - more than $12 billion. North Country Public Radio's Brian Mann follows opioid litigation for NPR, and he's on the line. Good morning.
BRIAN MANN, BYLINE: Hi, Steve.
INSKEEP: What did this audit cover?
MANN: Yeah, so this really goes back to the beginning of Oxycontin in the mid-'90s. And this firm providing documentation for this bankruptcy process found that, over the years, the Sacklers withdrew $12.2 billion from their company. And what's interesting here is a review by The New York Times, Steve, found that the Sacklers began pulling more and more cash out of the company faster, even as this opioid epidemic grew - hundreds of millions of dollars a year. Some of this money went to pay taxes, but a lot of it went into their personal trusts, and this is drawing special scrutiny also into offshore accounts.
INSKEEP: Well, if they took out $12 billion, how does that make it look that they're offering to pay $3 billion, give or take, to settle claims related to the opioid crisis?
MANN: Yeah, this is controversial, right? The Sacklers have consistently denied any wrongdoing, but they have offered this bankruptcy deal that would mean them paying billions of dollars in their own cash, while giving up control of Purdue Pharma. They've asked the bankruptcy court to then essentially shelter them personally, stop all personal lawsuits against them. They would be out of the opioid business but still really, really rich because of Oxycontin.
And what we're seeing is a coalition of states pushing back, saying we want to know where the cash went, where it is now and can we claw any more of that back. And this - the audit that just came out on Monday is adding fuel to that legal fight. We heard from New York Attorney General Letitia James last night. She issued a statement demanding more transparency and, really, a picture of where all the Sackler family's assets are.
INSKEEP: Yeah, we've got about $9 billion extra that are out there to be contested over, I suppose. Then there's the question of bonuses for company executives. What happened there?
MANN: Yeah, this is interesting. You know, this company is still an operating business. And and what Purdue Pharma told Judge Robert Drain in this bankruptcy court is, look - we need to pay bonuses to keep people working for us, about $35 million in bonuses to employees, and the judge went along with it. He gave the green light for those bonuses to be paid out, keep people going through this turbulent time for Purdue Pharma. But obviously, you know, this is money - $35 million - that will not be paid to victims or to communities that are struggling with opioid addiction.
INSKEEP: You know, I guess if you're a drug company executive at this point, you just want to see the bottom - like, what's the bottom line? How much is this going to cost me? What do I have to pay to make this go away, to settle it and to move on? Is the drug industry anywhere near knowing what the price is?
MANN: You know, the legal experts we've been talking to, Steve, say there is no end in sight to this. Opioid litigation across the country is a mess right now and, in part, because the situation on the ground is a mess - roughly 130 Americans still dying every day from overdoses. State and local governments say they need tens of billions of dollars to save lives and begin the recovery process. But right now, no big global deal has been found that will resolve liability and get that help to communities that need it.
INSKEEP: Brian, thanks as always, for your reporting.
MANN: Thank you, Steve.
INSKEEP: Brian Mann covers opioid litigation for NPR. Transcript provided by NPR, Copyright NPR.