Purdue Pharma files for bankruptcy as part of opioid crisis lawsuits

Clay Curtis
September 19, 2019

Lipson says he predicts Purdue will ask the bankruptcy court to extend the hold on the settlement deal in order to protect the Sackler family from litigation that would hold them responsible.

Purdue's top executives met late Sunday to approve the bankruptcy filing, which was made in a federal court in White Plains, New York.

Approximately 2,000 states, counties and municipal governments had sued Purdue, arguing that it lied about the addictive qualities of its opioid drugs as it aggressively marketed them to health care providers.

As well as giving up control of Purdue, the settlement will also see the wealthy Sackler family personally contribute $3 billion, with the potential for further monetary contributions.

New York's Guggenheim Museum, the Metropolitan Museum of Art, and London's Tate Modern have said they would stop accepting donations from the family, and the Louvre Museum in Paris recently removed the Sackler name from its Sackler Wing of Oriental Antiquities.

Purdue's proposed settlement envisions it becoming a trust that would contribute to USA communities, at little or no cost, tens of millions of doses of drugs the company developed to combat opioid overdoses and addiction, the company said.

"This settlement framework avoids wasting hundreds of millions of dollars and years on protracted litigation", Steve Miller, chairman of Purdue's board of directors, said, adding that the company will keep on working with plaintiff representatives to thrash out the settlement agreement "as quickly as possible".

This May 8, 2007 file photo shows the Purdue Pharma logo at its offices in Stamford, Conn.

The Sackler family had been in talks for weeks to settle the cases.

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A spokesperson for Mortimer D.A. Sackler called the attorney general's contention an attempt to "torpedo a mutually beneficial settlement that is supported by so many other states and would result in billions of dollars going to communities and individuals across the country that need help".

In a statement, the Sackler family, which owns Purdue, said it hopes the bankruptcy reorganization process "will end our ownership of Purdue and ensure its assets are dedicated for the public benefit".

A lead lawyer for the case told Star Vancouver that his team is pursuing members of the Sackler family directly for what they say is their role in the opioid crisis.

Purdue said it was on track to spend $263-million this year defending itself, according to court filings.

Attending Healey's news conference Monday were about a dozen people who had struggled with addiction to OxyContin and other opioids, or had family members who did.

"This court-supervised process is meant to, among other things, facilitate an orderly and equitable resolution of all claims against Purdue, while preserving the value of Purdue's assets for the benefit of those impacted by the opioid crisis", the company said in a statement, which also offered some details of the company's settlement proposal.

Because not all the attorneys general have agreed to the settlement, litigation is expected to continue.

The proposed settlement requires the company to file for bankruptcy, which it ultimately did on Sunday. But a modification to the initial settlement to satisfy more cases could delay the case.

VOA News and the Reuters News Agency reported this story.

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