Purdue Pharma filed for bankruptcy in the first step in a complex, multibillion-dollar plan by the maker of OxyContin to settle thousands of lawsuits brought against it by state and local governments over the nation’s deadly opioid disaster.
The company and members of the Sackler family, which owns it, expressed sympathy but not responsibility.
“Like families across America, we have deep compassion for the victims of the opioid crisis,” family members said in a statement, calling the settlement plan a “historic step towards providing critical resources that address a tragic public health situation.”
But the bankruptcy filing, made late Sunday, may not get either the drugmaker or the Sacklers off the legal hook.
About half the states and lawyers representing at least 1,000 local governments have agreed to the tentative settlement, which the company says could be worth $10 billion to $12 billion over time and would include at least $3 billion from the Sacklers.
Iowa was not among the states that were part of this agreement.
Under the settlement, the family would give up control of the company, and Purdue Pharma would be transformed into a sort of hybrid between a corporation and a charity.
It would continue to sell opioids, but its profits would be devoted to cleaning up the opioid mess and reimbursing state and local governments for the cost of the crisis that has killed more than 400,000 Americans in the past two decades.
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But a number of the other states that are holding out — including Iowa — have made it clear that they intend to object to the deal in bankruptcy court and seek to continue their lawsuits against members of the Sackler family.
“At every turn, we will fight their craven strategy to use bankruptcy to shield their wealth & to evade our claims to secure billions of dollars for addiction science & treatment,” Connecticut Attorney General William Tong tweeted Monday.
In all, the company is facing some 2,600 lawsuits, mostly from local governments.