The defining mass tort of the opioid epidemic reached its endgame: Purdue Pharma’s $7.4B bankruptcy plan, with the Sacklers paying up to $7B over 15 years under consensual, opt-in releases, went effective May 1, 2026, dissolving the company and launching public-benefit successor Knoa Pharma.
Latest development Jul 2026
The plan went effective on May 1, 2026, Purdue dissolved, Knoa Pharma launched under nonprofit ownership, and the Sacklers’ initial payment of over $1.5B (plus roughly $900M from Purdue) began flowing to governments. The Personal Injury Trust is fully funded, with individual victim distributions expected to begin in Q3 2026.
Why it matters
This closes the defining mass tort of the 2010s on post-Harrington consensual-release terms, making it the template for every future mass-tort bankruptcy: how to deliver billions to governments and victims at scale, and extract payment from individual owners, now that nonconsensual third-party releases are off the table. It is implementation, not contested litigation, but its mechanics will be cited for decades.
Background
Purdue Pharma, maker of OxyContin, filed for Chapter 11 in September 2019 under the weight of roughly 3,000 opioid lawsuits. Its first plan, built on sweeping nonconsensual releases shielding the Sackler family, was confirmed in 2021 but destroyed by the Supreme Court in Harrington v. Purdue Pharma (June 2024), which held 5–4 that the Bankruptcy Code does not authorize releases of claims against non-debtors without claimants’ consent. The reset produced a larger deal announced in January 2025: approximately $7.4B in total value, with the Sacklers paying up to $7B over 15 years, restructured around opt-in releases. More than 99% of voting creditors approved, and Judge Sean H. Lane confirmed the new plan in November 2025.
Implementation is now under way. The plan went effective on May 1, 2026: Purdue dissolved and its assets passed to Knoa Pharma LLC, a public-benefit company owned by the nonprofit Knoa Foundation, barred from marketing opioids and supervised by an independent monitor. The Sacklers paid an initial installment of over $1.5B (with roughly $500M due in May 2027 and 2028 and $400M in 2029) and Purdue contributed about $900M at effectiveness. The family is permanently barred from selling opioids in the United States and must disclose over 30 million documents. Abatement payments to states, local governments and tribes are flowing, with most funds due within three years, and the fully funded Personal Injury Trust, covering both NAS and non-NAS victims, with base awards of roughly $8,100 to $25,700 before deductions, expects to begin individual distributions in the third quarter of 2026.
Timeline 8 events
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OtherPersonal Injury Trust prepares first victim distributions
The fully funded trust set base awards of $16,294 (Tier 1) and $8,147 (Tier 2) for non-NAS claims and $25,653 for NAS claims, with distributions expected to begin in Q3 2026.
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SettlementPlan effective: Purdue dissolves, Knoa Pharma launches
Purdue ceased to exist and its assets passed to Knoa Pharma LLC, a public-benefit successor barred from opioid marketing. The Sacklers paid an initial $1.5+ billion and Purdue about $900M, with government distributions beginning.
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SettlementBankruptcy court approves $125M Purdue-McKinsey settlement
The Purdue Pharma bankruptcy estate obtained court approval for a $125M settlement with McKinsey & Co. resolving claims related to McKinsey’s consulting work on OxyContin marketing.
Purdue Pharma, McKinsey Net Court Approval of Bankruptcy Deal
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JudgmentBankruptcy court confirms the new plan
Judge Sean H. Lane confirmed Purdue’s plan of reorganization after more than 99% of voting creditors opted in to the consensual releases.
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SettlementNew $7.4B settlement announced
States and claimants struck a larger post-Harrington deal, the Sacklers paying up to $7B over 15 years plus Purdue’s assets, built on opt-in, consensual releases.
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JudgmentSupreme Court rejects nonconsensual releases (Harrington v. Purdue Pharma)
A 5–4 Court held the Bankruptcy Code does not authorize releases of claims against non-debtors without claimants’ consent, unwinding the plan and forcing renegotiation.
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JudgmentFirst plan confirmed with nonconsensual Sackler releases
The original plan granted the Sacklers sweeping litigation releases over objections from several states and the U.S. Trustee, releases that would ultimately be voided.
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FilingPurdue Pharma files for Chapter 11
Facing roughly 3,000 opioid lawsuits from governments and individuals, Purdue sought bankruptcy protection in the Southern District of New York.