Tulsa’s Oklahoma State University Center for Health Sciences could become a national leader in opioid addiction research and treatment as a result of the state’s $270 million settlement with Purdue Pharma, officials said Tuesday.
“We think this puts (OSU-CHS) in position to be on the level of (Houston’s) M.D. Anderson Cancer Center,” Attorney General Mike Hunter said in explaining details of the agreement Tuesday morning.
Specifically, OSU-CHS’ Center for Wellness and Recovery is to receive $102.5 million from Purdue up front and $20 million in anti-addiction medication over a five-year period, Hunter said.
Over that same five-year period, the Sackler family — which owns Purdue — will personally pay $75 million to the center, for a total of $197.5 million.
Officials said the money will be put into a foundation or endowment fund patterned after that of the M.D. Anderson Center in Houston and used to fund research and treatment through the Center for Wellness and Recovery.
The earnings from that endowment will significantly boost the center’s current annual budget of about $2.5 million, said OSU-CHS President Kayse Shrum.
In addition, Purdue has agreed to pay the state of Oklahoma $72.5 million, of which $12.5 million will go to local governments and $500,000 will go to the Attorney General’s Office for its expenses in the case.
The remaining $59.5 million will be divided among two private law firms in Oklahoma City and one in Texas.
Hunter said the settlement also bars Purdue from promoting — but not selling — opioids in Oklahoma.
Cleveland County District Judge Thad Balkman signed a consent decree confirming the deal Tuesday morning.
Hunter said the settlement does not release other defendants in the state’s suit, which is scheduled for trial in Cleveland County beginning May 28.
A year ago Hunter predicted that the state could win a judgment of $1 billion or more should the case go to a jury.
Any court judgment will be reduced by the $270 million Purdue and the Sackler family have agreed to pay.
On Tuesday, Hunter said he and the state’s lawyers had to weigh that possibility of a larger judgment against the likelihood that Purdue would file bankruptcy in the face of such a verdict. Hunter said negotiating Purdue’s payment up front and getting the Sackler family to personally guarantee the remaining $75 million protects the state against a bankruptcy as much as possible.
Hunter also said Purdue assured the state that it would not take bankruptcy in the short term.
Nationally, Tuesday’s settlement spurred speculation about the potential impact on a massive federal case involving 1,600 plaintiffs and another 35 state cases pending against Purdue, manufacturer of the pain medication OxyContin.
Hunter said the settlement’s unusual structure, with most of the payments going to OSU’s Wellness and Recovery Center instead of the state itself, allowed Purdue to cast the agreement in national terms instead of “state-centric.”
In its news release, Purdue said the payments to OSU-CHS “will establish a National Center for Addiction Studies and Treatment” whose “mission will be to improve the lives of people in Oklahoma and across the country that are affected by pain and substance use disorders through programs focused on research, education, treatment, and public policy initiatives. The Center’s vision is to become the premier addiction research center in the country.”
Whether the Wellness and Recovery Center will become the National Center for Addiction Studies and Treatment was unclear, but officials said it will not carry the Purdue or Sackler names.
The Wellness and Recovery Center opened less than 18 months ago with funding Shrum put together from OSU-CHS’ existing budget. It has since won some grants.
The center is partnered with 12&12 treatment program and affiliated with the Hazelden Betty Ford Patient Care Network.