Activist Ryan Hampton sees a major flaw in the proposed $7.4 billion bankruptcy settlement reached by the OxyContin maker. While it’s potentially one of the largest opioid settlements ever, he says victims stand to see only a small portion of the funds.
Facing thousands of lawsuits over its role in the deadly opioid crisis, Purdue declared bankruptcy in 2019. At the time, Purdue was debt-free and worth more than a billion dollars. But the company was facing trillions in claims and resorted – along with its wealthy owners, members of the Sackler family – to the bankruptcy process for a resolution.
Bankruptcy is about money, not justice, Hampton told 60 Minutes. “It’s about who gets paid the most and who gets paid out in what order.”
Hampton was appointed by the Justice Department in 2019 to represent the financial interests of victims in the Purdue Pharma bankruptcy case. For two years, he served on a committee of creditors.
The claims against Purdue Pharma and members of the Sackler family
Hampton is one of 140,000 claimants saying they or someone they love were harmed by Purdue’s opioids. He was 23 when he says he was prescribed OxyContin for a knee injury in 2003. The one-time White House intern said he quickly became addicted to the powerful opioid, lost his job working on political campaigns and became homeless.
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With treatment, Hampton overcame his addiction 10 years ago and started speaking out against Purdue and the Sacklers.
As part of the bankruptcy case, seven Sacklers — all former Purdue board members or employees — were deposed in 2020. Dr. Richard Sackler, a former Purdue president, in 2001 helped turn OxyContin into what was, at the time, the most prescribed brand-name narcotic in the U.S. During the bankruptcy deposition, he described the drug’s benefits and was asked about the drug’s deadly risks.
His son, David Sackler, helped manage the family’s wealth and also served on Purdue’s board of directors. During depositions, he was asked about the responsibility Purdue had toward the patients who were prescribed the company’s opioids and then suffered from Opioid Use Disorder, or addiction.
“What responsibility does it have to them? These were defined risks on the label and although we feel terrible for them, I think we’ve taken a dramatic amount of responsibility for them,” David Sackler said.
Members of the Sackler family have agreed to pay up to $6.5 billion of the proposed settlement amount over the next 15 years. If the deal is finalized, Purdue is expected to pay about $900 million.
The “kick in the gut” for victims
Members of the Sackler family continue to own Purdue Pharma, and to this day, not a single victim has received any compensation, according to a recent status report filed by mediators. And while the proposed $7.4 billion settlement may sound like a lot, only about 10% of the total amount will go to victims, according to the mediators’ report.
Claiming nearly 90% are other creditors, including 48 states, thousands of hospitals, insurance companies and top pharmacy chains, all of which say they too paid a price in the opioid epidemic.
“It felt like every major company under the sun was coming for a part of Purdue,” Hampton said.
He called it a “money grab” and pointed toward CVS, which has a claim in the bankruptcy case.
“CVS was charged by the Department of Justice for knowingly filling suspicious opioid prescriptions as late as last year,” Hampton said.
Court records show that lawyers, mediators and others have already pocketed nearly $1 billion paid by Purdue. And 41 firms have so far been paid more money than victims are expected to get in the proposed $7.4 billion settlement deal.
He also believes some victims won’t receive any payments.
“It is a kick in the gut,” Hampton said.
To have a valid claim, many victims will need to show proof of a Purdue opioid prescription. That means some families do not expect to get a dime in the settlement, like Emily Walden.
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Walden said her son, TJ, became addicted to opioids after taking OxyContin as a teen. He was 21 and in the Kentucky National Guard when he overdosed 13 years ago.
“I’ve talked to a lot of parents. I know a lot of people that have filed claims,” Walden said. “Nobody wants their blood money. But do they have a right to it? Did they pay for a funeral? Did they pay for treatment due to the actions of that company and the Sacklers? Should they get that money back? Absolutely.”
Her son’s death certificate lists oxycodone, the active ingredient in OxyContin and other prescription opioids, as a factor. That may not be enough proof in the bankruptcy case.
Walden explained why people should be eligible for compensation as part of the settlement, even if they weren’t taking the drug as prescribed.
“They knew they were making massive profits on putting these on the street. They knew that. Why would they not be held liable for that?” she said of Purdue. “You knew it was being diverted. And you let it go.”
Victims’ families call for the Sacklers to face criminal charges
Purdue has pleaded guilty to four felonies over three decades, including a 2007 plea that the company lied about OxyContin being less addictive and less prone to abuse than other pain medications.
But to this day, no member of the Sackler family or Purdue employee has ever faced felony charges.
Former federal prosecutor Rick Mountcastle led the four-year investigation that resulted in Purdue’s 2007 guilty plea. He says he was ready to charge three top Purdue executives with felonies.
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He hoped the three executives — Purdue’s top lawyer Howard Udell, medical director Paul Goldenheim and President Michael Friedman — would roll on members of the Sackler family, who had dominated the company’s board for decades.
But Mountcastle says the felony charges were blocked by his superiors at the Justice Department during the George W. Bush administration. Instead, in 2007 the three executives pleaded guilty to misdemeanors but denied having any knowledge of Purdue’s crimes.
“Decisions are being made, not based on the facts and what’s in the best interest of the American people; these are decisions that are being made based on politics and personal gain,” Mountcastle said.
After 30 years as a federal prosecutor, he says he’s disappointed in the Department of Justice.
“Everything that the department has done since 2007 to today has been to protect the billionaires, the Sackler family,” Mountcastle said.
The Sacklers maintain their innocence and have agreed to settle claims in the bankruptcy not as an admission of guilt, but to end years of litigation. The family will also give up ownership of Purdue, but their vast wealth remains.
In the years leading up to the bankruptcy, the Sacklers took about $11 billion out of Purdue, more than 70% of the company’s total assets. 60 Minutes requested interviews with members of Richard Sackler’s family, but did not hear back on that request.
Prior to 60 Minutes’ March 9 broadcast, which featured correspondent Cecilia Vega’s report on the Purdue Pharma settlement, we reached out to Purdue Pharma for comment on our story, “The Settlement.” The company responded to 60 Minutes with the following statement:
“We are gratified to have reached a new agreement with virtually all of the private and governmental stakeholders in these cases. The terms of the settlements are the product of intense work with our creditors, with a single-minded focus on delivering billions of dollars to compensate victims, abate the opioid crisis, and deliver overdose rescue medicines that will save lives. We are now hard at work fully documenting these settlements, including in a new Plan of Reorganization, which we look forward to presenting to the bankruptcy court. We are working to emerge as a public benefit company – 100% devoted to improving the lives of Americans – as soon as possible.”
