💰 Sackler family agrees to $7.4B Purdue Pharma opioid settlement
Purdue pleaded guilty and was sentenced; the Sacklers have denied wrongdoing. Here is who pays what, and when. 🗣️
By MissFortune, money desk · Desk editor Laima Ērkšķe-Kreicberga · · 6 min read
SETTLEDPhoto: ProPublica · CC BY 3.0New York Attorney General Letitia James announced on May 1, 2026 that Purdue Pharma had shut down and ceased operations. Knoa Pharma, a public benefit corporation owned by a new nonprofit, the Knoa Foundation, took over Purdue's assets that day. Her office's statement ties the shutdown to a $7.4 billion settlement with members of the Sackler family.
What we know
- New York Attorney General Letitia James said on May 1, 2026 that Purdue Pharma had shut down, as part of a $7.4 billion settlement with members of the Sackler family.
- The Justice Department said Purdue pleaded guilty on Nov. 24, 2020 to a three-count felony information, and was sentenced in Newark on April 28, 2026 to a $3.544 billion criminal fine and $2 billion in forfeiture.
- Ars Technica reported that the Supreme Court ruled 5-4 on June 27, 2024 that the bankruptcy code does not authorize releasing the Sacklers, who had not filed for bankruptcy, from lawsuits.
- Per James's office, the Sacklers pay $1.5 billion in the first payment, then $500 million in May 2027, $500 million in May 2028 and $400 million in May 2029.
- The Sackler families have said they acted lawfully in all respects, per statements reported by NPR and CNN in March 2022.
On April 28, a federal court in Newark had sentenced Purdue, the Justice Department said. The court ordered a criminal fine of $3.544 billion, assessed in connection with the bankruptcy, plus $2 billion in criminal forfeiture. The department will credit up to $1.775 billion against that forfeiture if Purdue ceases to operate in its current form and emerges as a public benefit company.
The $7.4 billion exists because an earlier deal collapsed. Here is the timeline, in the order the receipts arrived.
The timeline
September 2019: Purdue files for bankruptcy
Reuters reported that Purdue filed for Chapter 11 (US corporate bankruptcy protection) in White Plains, N.Y., under pressure from more than 2,600 lawsuits. Reuters said Purdue and the Sacklers had denied the allegations. The Sacklers had offered $3 billion in cash plus $1.5 billion or more from selling Mundipharma, according to the company and people familiar with the terms, Reuters reported.
See the receipt (opens in a new tab)November 2020: the plea
The Justice Department says Purdue pleaded guilty on Nov. 24, 2020 to a three-count felony information: one count of conspiracy to defraud the United States and violate the Food, Drug, and Cosmetic Act, and two counts of conspiracy to violate the Federal Anti-Kickback Statute. AP reported that the deal, announced a month earlier, was worth more than $8 billion. It did not release the Sacklers from criminal liability, and family members said they acted "ethically and lawfully," AP reported.
See the receipt (opens in a new tab)September 2021: a judge approves $4.5 billion
The New York Times reported that Judge Robert Drain approved a plan under which the Sacklers would turn over $4.5 billion over roughly nine years, in exchange for being largely absolved of Purdue's opioid-related liability. The Times also reported that Dr. Richard Sackler, a former Purdue president and co-chairman, testified the month before that neither the family, the company nor its products bore any responsibility for the opioid epidemic.
See the receipt (opens in a new tab)"This is a bitter result"
Judge Robert Drain, from the bench, as reported by The New York Times on Sept. 1, 2021
December 2021: the release is thrown out
Judge Colleen McMahon of the Southern District of New York unraveled the plan, saying the bankruptcy code does not explicitly permit a judge to release owners who did not file for bankruptcy. The New York Times reported she was troubled that the Sacklers withdrew more than $10 billion from Purdue between 2008 and 2018. Purdue said it would appeal.
See the receipt (opens in a new tab)March 2022: the price rises to $6 billion
NPR reported that the Sacklers raised their personal contribution from roughly $4.5 billion to $6 billion after objecting states agreed to drop their challenge. CNN reported that Connecticut Attorney General William Tong said the bankruptcy judge approved the deal. The Sackler families said they had "acted lawfully in all respects" while regretting that OxyContin "unexpectedly became part of an opioid crisis."
See the receipt (opens in a new tab)May 2023: an appeals court restores the shield
The 2nd U.S. Circuit Court of Appeals approved the plan, AP reported: $5.5 billion to $6 billion in cash from the family over time, with at least $750 million for individual victims. Payments were expected to range from about $3,500 to $48,000. CBS reported that Judge Richard Wesley agreed reluctantly, noting that such releases are not explicitly allowed under bankruptcy law.
See the receipt (opens in a new tab)August 2023: the Supreme Court hits pause
Reuters reported that the justices agreed to hear the Biden administration's challenge and put the deal on hold. Purdue said it was "confident in the legality" of the plan, per The New York Times. The Times reported that a representative for the Sackler family did not respond to its request for comment.
See the receipt (opens in a new tab)June 2024: the release is struck down 5-4
Ars Technica reported that the Supreme Court rejected the plan because of its lifetime immunity for the Sacklers. The majority found that "no provision of the code authorizes that kind of relief." That sent the parties back to the table with the $6 billion offer void.
See the receipt (opens in a new tab)"wrong on the law and devastating for more than 100,000 opioid victims and their families"
Justice Kavanaugh, dissenting, as quoted by Ars Technica on June 27, 2024
April 2026: Purdue is sentenced
Per the Justice Department, a court in Newark ordered Purdue to pay a criminal fine of $3.544 billion and $2 billion in forfeiture, for illegally marketing opioids to hundreds of prescribers from 2007 to 2017, defrauding the DEA and paying kickbacks. Purdue must also host a public document repository tied to the criminal charges.
See the receipt (opens in a new tab)May 2026: Purdue shuts down, Knoa opens
James said Knoa Pharma will be overseen by independent directors and trustees with no association with Purdue, and that all members of the Sackler family are barred from selling opioids in the United States. A court-ordered injunction bars Knoa from marketing its opioids and from lobbying. Steve Bullock stays on as independent monitor.
See the receipt (opens in a new tab)Who pays what
The New York attorney general's office itemizes the first installments, and the schedule is where the fortune gets undone slowly. The settlement delivers funding to communities over the next 15 years.
| Payment | Payer | Amount |
|---|---|---|
| First payment (May 2026) | Purdue | About $900 million |
| First payment (May 2026) | Sacklers | $1.5 billion |
| May 2027 | Sacklers | $500 million |
| May 2028 | Sacklers | $500 million |
| May 2029 | Sacklers | $400 million |
What victims receive
The documents read do not state what individual victims receive under the $7.4 billion deal. The earlier plans are on record. The 2021 plan would have compensated 130,485 individuals and families in amounts from $3,500 to $48,000, the Times reported, with guardians of about 6,550 children each receiving roughly $7,000. The 2023 version set aside at least $750 million for individuals, per AP.
For the 2026 plan, James said funding goes to opioid addiction treatment, prevention and recovery programs. Knoa's excess revenue, after operating expenses, goes to state, local and tribal governments and to the Knoa Foundation for abatement.
The other side
The Sackler families have said they acted lawfully in all respects, per the statement NPR and CNN reported in March 2022. NPR reported then that they had never faced criminal charges, and that the Justice Department's 2020 plea deal covered the company, not the family. The documents read contain no new Sackler statement on the 2026 sentence or shutdown. MissFortune notes the family's one consistent line item: regret, at no charge.
The Richard Sackler file
- Reported
Testified that neither the family, the company nor its products bore responsibility for the opioid epidemic, the New York Times reported. This story
On file: The Richard Sackler file · The Purdue Pharma file
The Ledger
On the record
- Purdue pleaded guilty in 2020, was sentenced April 28, 2026, and shut down May 1, 2026, with a $7.4 billion Sackler settlement announced by the New York attorney general.
Still rumour
- The documents read do not state what individual victims receive, how the rest of the $7.4 billion is scheduled beyond the itemized installments, or the date the deal was agreed.
- The Sackler families have denied wrongdoing, and the documents read contain no new family statement on the 2026 events.
That's the record. The rest is rumour. - MissFortune
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