When Pharma Fraud Kills

The films in this collection are different from the others in the Bankrupt Giants catalogue. The Sackler family and Elizabeth Holmes did not just lose money. They lost lives.

The Centers for Disease Control and Prevention count approximately 806,000 opioid overdose deaths in the United States between 1999 and 2023 — more deaths than the entire World War II American military combined casualties. Not all of those deaths were caused by OxyContin specifically. The first wave was prescription opioids; the second wave, after Purdue Pharma reformulated OxyContin in 2010 to be harder to crush, was heroin — millions of dependent patients cut off from their prescriptions and routed to the street supply; the third wave, the one still killing roughly two hundred Americans a day, is illicit fentanyl. But the historical scholarship is settled: Purdue's 1996 launch of OxyContin and the marketing campaign that followed is the proximate ignition source.

The Sackler family extracted approximately $10.4 billion in cash from Purdue Pharma between 2008 and 2017, according to a forensic accounting report commissioned by Purdue's own bankruptcy advisors. The pace of extraction accelerated approximately eightfold after the company's 2007 felony misbranding plea, when senior management could see clearly that the long-term legal exposure was real. The 2019 Chapter 11 filing was a tactical decision to consolidate roughly 2,600 lawsuits into a single forum and negotiate a single grand bargain — civil immunity for the Sackler family in exchange for a multi-billion-dollar payment plan stretched over fifteen years.

The Supreme Court ruled five-to-four in Harrington v. Purdue Pharma on June 27, 2024 that the Sacklers could not buy that immunity through a corporate bankruptcy they had not themselves filed. Justice Neil Gorsuch wrote the majority opinion. He was joined by Justices Thomas, Alito, Barrett, and Ketanji Brown Jackson — a coalition that crossed every conventional ideological line on the court. Justice Brett Kavanaugh wrote a long dissent calling the ruling devastating for opioid victims and their families.

Eighteen months later, in November 2025, the Sacklers and the plaintiffs agreed to a revised $7.4 billion deal. The Sacklers themselves committed to up to $6.5 billion over fifteen years. Purdue committed to an additional $900 million. Judge Sean Lane approved the deal from the bench on November 18, 2025 in the federal bankruptcy courtroom in White Plains. Purdue Pharma was dissolved and replaced by a public-benefit company called Knoa Pharma, with no Sackler on the board.

The number of Sacklers charged with crimes in the United States: zero. The number who have served any prison time: zero. The number who remain billionaires after the settlement payment plan: most of them. The first installment is due at plan effectiveness; the last installment is not due until 2040.

Theranos's harm was smaller in scale but the structure of the deception was equally clinical. Between 2013 and 2016, the company processed millions of blood tests in Walgreens stores in California and Arizona on its proprietary Edison device — except that Edison did not actually work, so the vast majority of tests were silently run on conventional Siemens and other commercial analyzers. Federal investigators identified individual cases of false results that led to misdiagnoses, including missed pulmonary emboli, false-positive cancer markers, and incorrect potassium and HIV results. The systemic harm is hard to quantify because the company actively destroyed and rewrote test data when the U.S. Centers for Medicare and Medicaid Services arrived for an inspection.

Elizabeth Holmes was convicted of four counts of investor fraud in January 2022 and sentenced to 11 years and three months. Sunny Balwani was convicted on additional counts and sentenced to nearly 13 years. The patients themselves were not the basis of the criminal case. The trial focused on investor losses — the $945 million the company raised from Rupert Murdoch, the Walton family, Betsy DeVos, and the Cox family. The patient-harm count was severed and ultimately dismissed.

Both cases illustrate the same structural problem. The regulatory architecture in the United States for catching pharmaceutical and medical-device frauds before they kill people relies primarily on the FDA, CMS, and state attorneys general. The FDA medical officer who approved OxyContin's controlled-release label in 1995, Curtis Wright, left the agency two years later to take a job at Purdue Pharma at approximately three times his FDA salary. The Walgreens partnership that put Edison machines into pharmacies was approved despite known internal red flags. The revolving door between regulator and regulated — well-documented in academic literature on regulatory capture — appears in case after case.

The two films in this collection do not have the comic energy of an SBF testimony or a Trevor Milton truck demo. They are about what happens when the fraud is the product itself, and the customers are patients.