Purdue Pharma, after reaping billions in opioid drug sales, has been battling over its role in the U.S. addiction crisis for years. Now, it's potentially won an out after several states challenged its multibillion-dollar settlement plan.
Fifteen states, including Massachusetts and New York, have blessed OxyContin maker Purdue Pharma's controversial bankruptcy reorganization plan, a court filing in the U.S. Bankruptcy Court in White Plains, New York, shows.
Under the deal, Purdue would morph into a nonprofit and secure protection from future opioid litigation. The company's owners, the Sackler family, would pay more than $4 billion in a settlement covering thousands of cases linked to Purdue's role in the opioid crisis.
Purdue and the Sacklers will also hand over "tens of millions" of documents and roughly "13 categories of attorney-client privileged documents," the court filing states. Both Purdue and members of the Sackler family, which is one of the wealthiest clans in the U.S., have previously tried to limit the scope of documents released, The New York Times reports.
To pull themselves out of an opioid quagmire, the Sacklers have promised to hand over control of Purdue and cough up $4.2 billion from their own pockets, NPR reports. They're also hashing out a rare bankruptcy procedure known as "non-consensual third-party releases" that would effectively guard them and their assets from further opioid litigation.
The deal could sidestep years of litigation and allow those hit by the opioid epidemic to receive financial aid sooner, NPR reported in May.
In late June, 24 state attorneys general, plus the attorney general for Washington D.C., filed a brief taking aim at the bankruptcy plan, which they branded "unprecedented" and "unjust," NPR said. While a handful of states have now given in, nine others, plus Washington D.C., continue to push back on Purdue's bankruptcy scheme, according to the court filing.
Washington attorney general Bob Ferguson, for his part, said he could not "in good conscience" accept the terms of Purdue's deal. The latest settlement plan "allows the Sacklers to walk away as billionaires with a legal shield for life," he said.
"To add insult to injury, they don't even have to apologize," he added in a statement.
Purdue has spent years in court battling over its role in the U.S. opioid crisis. It settled with the Justice Department for more than $8 billion in October to plead guilty and settle federal criminal and civil claims linked to its OxyContin actions. That settlement is separate from a $10 billion to $12 billion civil payout Purdue has floated to settle state and local claims.
While certainly one of the most well-known, Purdue is far from the only drugmaker facing down opioid litigation. Johnson & Johnson late last month inked a $230 million settlement to remove itself as a defendant in a high-profile opioid case now ongoing in New York.