Bankrupt Purdue buys time to advance $7.4 billion opioid deal
By Dietrich Knauth
NEW YORK (Reuters) – Purdue Pharma said on Friday it wanted more time to build a new $7.4 billion fund that could end the company’s years-long effort to settle thousands of lawsuits over its addictive painkiller.
The company still must work out the remaining details and seek a buyout from states, local governments and other creditors who have sued the company and the Sackler family owners for their role in the deadly U.S. opioid epidemic.
Purdue’s lawyer, Benjamin Kaminetsky, said at a court hearing in White Plains, New York, that the company is “right there” in the settlement announced Thursday by several state attorneys general and will file a formal bankruptcy plan before the end of February.
U.S. Bankruptcy Judge Shane Lane, who is overseeing Purdue’s Chapter 11 proceedings, said the company is making substantial progress on the deal and approved a request to suspend all opioid lawsuits against Sacklers until at least the end of February.
The company The bankruptcy filing has halted litigation against the Sacklers and Purdue since it filed for Chapter 11 in 2019, and Lane has granted several short-term extensions of the litigation freeze in recent months.
“We’ve been working on this for a while now, and hopefully we’re getting to the bottom of it,” Lane said Friday.
Purdue filed for bankruptcy in 2019 in the face of thousands of lawsuits against him and members of the Sackler family, fueling the epidemic of misleading OxyContin marketing. Drug manufacturers, distributors, pharmacy operators and others have agreed to pay about $50 billion to settle similar lawsuits and investigations related to the U.S. opioid crisis.
The new settlement, backed by 15 states, gives the company a new chance to end its long bankruptcy after the US Supreme Court struck down an earlier opioid settlement. But there will be a long and uncertain road ahead before the settlement is approved and the money begins to flow to states, communities and individuals affected by the crisis.
The deal has not yet been reviewed by most of Purdue’s creditors, including states, local governments and individuals with legal claims against the Sacklers.
New York state attorney David Nachman said key terms of the deal will be published next week. States that negotiated the deal, including New York, California, Texas and West Virginia, are circulating it to other states to encourage them to support the deal.