Purdue Pharma shut down as opioid settlement takes effect, new nonprofit takes over

A long-running opioid giant is dismantled

The maker of OxyContin is no more.

Purdue Pharma has shut down and ceased operations under a bankruptcy plan backed by a bipartisan coalition of attorneys general, marking a major milestone in efforts to hold the company accountable for its role in the U.S. opioid crisis.

New York Attorney General Letitia James said in a press release that the move ends decades of Sackler family control over the company.

“This company that put profits over people for decades is now shut down forever,” James said.

The shutdown follows criminal sentencing in federal court tied to Purdue’s conduct in marketing opioids.

What replaces Purdue

In its place, a new entity — Knoa Pharma, LLC — begins operations immediately.

Key differences:

• Owned entirely by a nonprofit, the Knoa Foundation
• Governed by independent directors and trustees with no ties to Purdue
• Subject to court-ordered oversight and an independent monitor
• Banned from marketing opioids or lobbying
• Cannot tie executive pay to opioid sales

Former Montana governor and attorney general Steve Bullock will oversee compliance.

Knoa Pharma will continue manufacturing medications — including opioids — but under tighter public-health-focused controls.

The money: $7.4 billion over time

The restructuring is tied to a sweeping $7.4 billion settlement with the Sackler family and Purdue.

Payment schedule includes:

• $900 million from Purdue (initial)
• $1.5 billion from the Sacklers (initial)
• $500 million in 2027
• $500 million in 2028
• $400 million in 2029

Funds will flow to state, local, and tribal governments over 15 years for:

• Addiction treatment
• Prevention programs
• Recovery services

Where the money goes

After covering operating costs, Knoa Pharma’s excess revenue will also be distributed to governments and the nonprofit foundation to support opioid abatement.

New York alone is set to receive more than $3 billion across multiple opioid-related settlements secured by the attorney general’s office.

Those deals include manufacturers such as Johnson & Johnson and Teva Pharmaceuticals, distributors like McKesson, and retailers including CVS, Walgreens, and Walmart.

What this means for consumers

The bottom line: The company most associated with the opioid epidemic is gone — but opioids themselves are not.

What changes:

• No more Purdue brand or Sackler involvement in opioid sales
• New limits on how opioid drugs can be marketed and sold
• Billions in funding aimed at treatment and prevention

What doesn’t:

• Opioid medications will still be prescribed and manufactured
• Oversight depends on enforcement of court-ordered restrictions

Affordability Watch

The settlement could ease some long-term public costs of the opioid crisis — but its impact will depend on how effectively funds are used.

State and local governments now face pressure to:

• Direct funds to evidence-based treatment
• Expand access to addiction care
• Prevent misuse through education and monitoring

Advocates have warned in past settlements that misuse of funds — or delays in spending — can blunt the real-world impact.

The bigger picture

The dismantling of Purdue Pharma represents one of the most significant corporate reckonings tied to a public health crisis in U.S. history.

But officials acknowledge it’s only one step.

As James put it: nothing can fully undo the damage — but ending Purdue’s operations marks a turning point in how the opioid crisis is addressed and funded going forward.