Albany, New York - Several states have reached a $7.4 billion settlement with the Sackler family and their pharmaceutical company Purdue over the opioid crisis that has ravaged the lives of millions of Americans, officials said Thursday.

The opioid addiction epidemic has caused more than 500,000 overdose deaths in the US over two decades.

Thursday's settlement, which will see funds routed to communities and individuals affected by opioids, is the largest of several targeting the makers and sellers of the highly addictive drugs.

The $7.4 billion settlement was agreed "in principle with members of the Sackler family and their company Purdue Pharma for their instrumental role in creating the opioid crisis," New York Attorney General Letitia James's office said in a statement.

Purdue and other opioid makers and distributors were accused of encouraging free-wheeling prescription of their products through aggressive marketing tactics while hiding how addictive the drugs are.

Facing an avalanche of litigation, in 2021 Purdue pled guilty to three criminal charges over its marketing of OxyContin.

The Sacklers have consistently denied wrongdoing over the opioid crisis.