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OxyContin manufacturer Purdue offers $ 10B plan to get out of bankruptcy

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Purdue Pharma, which helped revolutionize the prescription drug business with its pharmaceutical OxyContin, is offering a $ 10 billion bankruptcy plan that seeks to transform it into another type of company that increases profits to fight the nation’s opioid crisis.

The effort will include a significant boost of more than $ 4 billion from members of the Sackler family who own a Connecticut-based pharmaceutical giant.

The Months lawsuit, filed in the U.S. Bankruptcy Court of White Plains late Monday night after months of negotiations, marks a formal offer by the company to resolve more than 2,900 lawsuits from state, local, Native American, hospital, and other organizations.

“Purdue has delivered a historic project that can have a profoundly positive impact on public health by directing much-needed resources to communities across the country and individuals affected by the opioid crisis,” said Steve Miller, chairman of the board of directors of Purdue.

Many parties to the case agree with the plan. But prosecutors from all 23 states, including the District of Columbia, issued a statement saying the offer was “inferior to the well-deserved account of survivors.” They want more money from members of the Sackler family to demolish Purdue so that “it does not become too entangled with the states.”

The group includes most of the Democrat attorney generals in the United States, including the Attorney General of the Republic of Idaho, Lawrence Wasden.

“The Sacklers became billionaires, causing a national tragedy. “Now they are trying to deal with it,” said Massachusetts Attorney General Maura Hill. “We will continue to fight for the accountability that all families in this country deserve.”

The true extent of the family’s capacity is unclear. Earlier in the lawsuit, family members reportedly received $ 12 billion to $ 13 billion in transfers from Purdue over the years, although the lawyer said most of it went to taxes or was reinvested in the company. In letters to the US House of Representatives last week, the two branches of the family that owned the family said that the family members who were members of the council had less net assets – about $ 1.1 billion.

Much of Purdue’s plan is similar to what the company proposed a year and a half ago when it first tried to file for bankruptcy, a move that ended lawsuits against both the company and members of the Sackler family who would continue to be legally isolated under the plan. requirements. ,

The company said in a statement that the Sackler family would invest nearly $ 4.3 billion over a decade, with an initial investment of $ 500 million, and another $ 1 billion in sales by the end of 2024, when it plans to sell or sell. otherwise transform the company again. It says that extra money will come from insurance claims.

Purdue said it would provide more than $ 4 billion in over-the-counter antidotes and anti-addiction drugs.

The company replacing Purdue indirectly owned two new trusts: one representing the interests of the state և local government: one `Native American tribes. Future profits will go to government agencies, which will pay for the monitoring of the health of children born as a result of opioid withdrawal. Governments will be required to use their share of treatment, drug education, and other opioid depletion programs.

Individual victims և their families distributed $ 700 to $ 750 million over time. In the case of almost 135,000 such claims, it will make payments of less than $ 5,600. Personal injury payments are expected to range from $ 3,500 to $ 48,000.

The parties to the lawsuit against Purdue have until the end of this year to vote on a new plan that calls for the creation of a public repository of company documents.

Purdue began selling OxyContin 25 years ago, encouraging physicians to abandon long-term opioid reservations and focus more on relieving patient pain. Court documents show that company officials continue to demand that the sale be maintained, even when it becomes clear that the drug is being abused.

More than 470,000 deaths in the United States since 2000 have been related to opioids, including both prescription and illicit drugs such as heroin and fentanyl. In 2019, the United States for the first time recorded 50,000 overdose-related deaths from opioids, and last year a number of states reported a record rate of overdose-related deaths from all drugs.

Complicated litigation continues in the country’s courts, seeking to prosecute the drug industry, including thousands of federal cases overseen by a Cleveland-based judge. Purdue was removed from those cases and other cases when he filed for bankruptcy.

U.S. federal trials are set to begin this year in California, New York, Ohio and West Virginia.

Separately, Purdue pleaded guilty to federal criminal charges; resolving civil complaints. The company’s federal deal is valued at more than $ 8 billion. But the United States says the company will have to pay him just $ 225 million as long as the company’s funds are used to alleviate the opium crisis.

In a separate federal deal announced at the same time, members of the Sackler family agreed to pay $ 225 million to the federal government, but did not admit any wrongdoing.

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Follow Mulvihill at http://www.twitter.com/geoffmulvihill

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