Opioid giant Purdue Pharma’s exit plan from bankruptcy gathers momentum with more states OK
(AP) – OxyContin maker Purdue Pharma’s plan to reorganize into a new entity that helps fight the opioid epidemic in the United States has received a big boost as 15 states that previously opposed to the new business model now support it.
The agreement of several state attorneys general, including those who had most aggressively opposed Purdue’s initial settlement proposal, was disclosed late Wednesday night in a case filed in U.S. bankruptcy court in White. Plains, NY. exit plan.
The new settlement terms call on Purdue to release tens of millions of internal documents to the public, a move several attorneys general, including those in Massachusetts and New York, had demanded as a way to hold the company accountable.
The attorneys general of both states were among those who agreed to the new plan, joining about half of the states that had already approved it.
In a joint press conference online Thursday, some of the attorneys general who signed noted that their states were ready to get more money faster to fund drug treatment and prevention.
But they continued to express their anger at the business and in particular the wealthy Sackler family members who own the business and have not accepted any blame. “No one is happy with the settlement,” New York Attorney General Letitia James said. “Can the Sacklers do more?” Hell, they can do a lot better, but it should start with an apology first.
North Carolina Attorney General Josh Stein noted Thursday that the deal included about $ 1.5 billion more than it initially did.
In a statement, members of the Sackler family called support from more states “an important step towards providing substantial resources to people and communities in need.”
Yet nine states and the District of Columbia have not signed. One of the holdouts, Washington Attorney General Bob Ferguson, complained, “This settlement plan allows the Sacklers to walk away as billionaires with a lifelong legal shield.
A 10th Attorney General, Patrick Morrisey of West Virginia, opposes the deal on separate grounds: that his state would be bypassed when the money was allocated. He reiterated this position on Thursday.
Purdue said in a statement he would try to build “even greater consensus” for his plan.
Purdue filed for bankruptcy protection in 2019 to settle approximately 3,000 lawsuits it faced from state and local governments and other entities. They said the company’s continued marketing of its powerful prescription pain reliever has contributed to a crisis linked to nearly 500,000 deaths in the United States over the past two decades.
The court record came from a mediator appointed by the bankruptcy court and shows that members of the Sackler family agreed to increase their cash contribution to the settlement by $ 50 million. They will also allow $ 175 million held in Sackler family charities to help alleviate the crisis.
In total, members of the Sackler family are contributing $ 4.5 billion in cash and assets to charitable funds for the settlement. They do not admit any wrongdoing and no court has found a family member.
The deal also prohibits the Sackler family from obtaining naming rights related to their charitable donations until they have paid all money owed under the settlement and given up all business interests related to the manufacture or sale of opioids.
Massachusetts Attorney General Maura Healey, who had been the first attorney general to prosecute members of the Sackler family, welcomed the amended deal in a statement Thursday morning. She highlighted the $ 90 million her state would receive and how the company could waive attorney-client privilege to disclose hundreds of thousands of confidential communications with attorneys about its opioid sales tactics and others. Questions.
“Although I know this resolution does not bring back loved ones or fix the evil of what the Sacklers did, forcing them to reveal their secrets by providing all the documents, forcing them to pay back billions, forcing the Sacklers to quit the opioid business, and shutting down Purdue will help prevent something like this from happening again, ”Healey said.
Purdue’s plan also calls on members of the Sackler family to relinquish ownership of the Connecticut-based company as part of a global deal it says could be worth $ 10 billion over time. This includes the value of overdose reversal drugs that the company plans to produce.
The money from the deal is to go to government entities, which have agreed to use it to address the opioid crisis, as well as to individual victims and their families.
Most groups representing various creditors, including victims and local governments, had reluctantly supported the plan. But state attorneys general have so far been deeply divided, with around half supporting the plan and the other half fighting against it.
Attorneys general who had opposed the plan said they did not like the idea of having to rely on profits from the continued sale of prescription painkillers to fight the opioid epidemic. The revised agreement allows state and local governments not to receive these funds. Attorneys general also said the deal did not do enough to hold members of the Sackler family accountable or to release documents that could help explain the company’s role in the crisis.
Last month, Healey of Massachusetts told The Associated Press: “The Sacklers are not offering to pay anything close to what they should pay for the damage and devastation to families and communities. from this country.
The support from other states comes less than two weeks before the deadline to formally oppose Purdue’s reorganization plan and about a month before a hearing on its acceptance.
With just nine states and the District of Columbia remaining opposed to the plan, the federal bankruptcy judge is more likely to uphold the deal.
Activists don’t like it either, and two Democratic members of Congress have called on the US Department of Justice to oppose it. Representatives Carolyn Maloney of New York and Mark DeSaulnier of California said in a statement Thursday that allowing members of the Sackler family “to obtain legal immunity through the Purdue bankruptcy would be a tragic miscarriage of justice.” The Department of Justice has not commented.
Last year, the company pleaded guilty to federal criminal charges and agreed to pay the federal government $ 225 million.
In a separate civil settlement announced at the same time, members of the Sackler family agreed to pay the federal government $ 225 million, while not admitting any wrongdoing.
The opioid crisis includes overdoses involving prescription drugs as well as illegal drugs such as heroin and fentanyl. The Purdue bankruptcy case is the most high-profile case in a complicated national litigation against drugmakers, distribution companies and pharmacies.
Lawsuits against other companies in the industry are taking place in California, New York and West Virginia, and negotiations continue to settle numerous claims.
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