Tag Archives: Purdue Pharma LP

15 more U.S. states reach settlement in OxyContin maker Purdue bankruptcy

By Mike Spector

NEW YORK (Reuters) -Fifteen more states reached an agreement with Purdue Pharma LP and members of its wealthy Sackler family owners that moved the OxyContin maker a step closer to resolving widespread opioid litigation and exiting bankruptcy protection.

All but a handful of states nationwide now support Purdue’s bankruptcy plan, with the latest agreement emerging after weeks of mediation.

The deal, outlined in bankruptcy court papers filed late on Wednesday, was reached after Sackler family members agreed to contribute another $50 million toward a proposed litigation settlement and to release tens of millions of additional internal documents for public inspection.

Another $175 million would come from relinquishing control of family charitable institutions. The Sackler family members have also agreed to a prohibition with regard to naming rights associated with charitable contributions until litigation settlement funds are fully paid, the documents said.

In all, the Sackler contributions toward Purdue’s bankruptcy-exit plan now total roughly $4.5 billion.

The plan aims to resolve some 3,000 lawsuits brought by U.S. communities alleging Purdue and its family owners contributed to an opioid crisis that has claimed the lives of roughly 500,000 people since 1999, according to the U.S. Centers for Disease Control and Prevention.

The Stamford, Connecticut-based company and family members have denied the allegations in the litigation.

Purdue said that the latest agreement built on support from other creditors in the company’s bankruptcy proceedings and that it hoped to reach additional consensus on its plan to move billions of dollars of value into trusts for addressing the U.S. opioid crisis. Sackler family members called the deal an “important step toward providing substantial resources for people and communities in need.”

The agreement, supported by longstanding holdouts including Massachusetts and New York, sets the stage for Purdue to gain court approval in coming weeks for its bankruptcy plan, which the company values at more than $10 billion. That value is contingent in part on future donations of overdose reversal and addiction treatment medications the company has under development.

The plan would dissolve the company and shift assets to trusts run on behalf of plaintiffs that alleged the company and its owners aggressively marketed the painkiller OxyContin while playing down its abuse and overdose risks.

“While I know this resolution does not bring back loved ones or undo the evil of what the Sacklers did, forcing them to turn over their secrets by providing all the documents, forcing them to repay billions, forcing the Sacklers out of the opioid business, and shutting down Purdue will help stop anything like this from ever happening again,” Massachusetts Attorney General Maura Healey, the first attorney general to sue Sackler family members, said in a statement.

If approved by the court, the bankruptcy plan would include legal releases shielding the Sacklers from future litigation. A bankruptcy judge halted lawsuits against both the company and the Sacklers after Purdue filed for Chapter 11 court protection in 2019.

“It is upsetting that the Sackler family never declared bankruptcy yet were still granted all the same protections of bankruptcy as their company,” New York Attorney General Letitia James said during a news conference with Healey and Minnesota Attorney General Keith Ellison on Thursday.

“There is no perfect solution here,” James added. “But we can’t let perfect be the enemy of the good. This deal gets one of the nation’s most harmful drug dealers out of the opioid business.”

Healey, who said she spoke to opioid victims earlier on Thursday, urged reform in aspects of the U.S. legal system that allowed the Sacklers to obtain relief from a federal bankruptcy court. But she welcomed the additional deposition transcripts, emails and other evidence that will eventually “be online forever, searchable and free to the public.”

Purdue in November separately pleaded guilty to three felonies arising from its marketing of prescription opioid painkillers, part of a separate settlement eclipsing $8 billion to resolve U.S. Justice Department criminal and civil investigations.

Sackler family members have not been criminally charged. They previously agreed to pay $225 million to resolve separate civil allegations with the Justice Department. The family members have denied those allegations.

(Reporting by Mike Spector; Editing by Howard Goller)

OxyContin maker Purdue Pharma pleads guilty to criminal charges

By Mike Spector

NEW YORK (Reuters) – Purdue Pharma LP pleaded guilty to criminal charges over the handling of its addictive prescription painkiller OxyContin, capping a deal with federal prosecutors to resolve an investigation into the drugmaker’s role in the U.S. opioid crisis.

During a court hearing conducted remotely on Tuesday before U.S. District Judge Madeline Cox Arleo in New Jersey, Purdue pleaded guilty to three felonies covering widespread misconduct.

The criminal violations included conspiring to defraud U.S. officials and pay illegal kickbacks to both doctors and an electronic healthcare records vendor, all to help keep medically dubious opioid prescriptions flowing.

Members of the billionaire Sackler family who own Purdue were not part of Tuesday’s court proceedings and have not been criminally charged. They agreed in October to pay a separate $225 million civil penalty for allegedly causing false claims for OxyContin to be made to government healthcare programs such as Medicare. They have denied the allegations.

Purdue Chairman Steve Miller entered the guilty plea on the company’s behalf and admitted to its criminal conduct under questioning from Assistant U.S. Attorney J. Stephen Ferketic. Of the three criminal counts against Purdue, two were for violations of a federal anti-kickback law while another charged the Stamford, Connecticut-based company with defrauding the U.S. and violating the Food, Drug and Cosmetic Act.

Purdue’s plea deal carries more than $6.5 billion in penalties, most of which will go unpaid. A $3.54 billion criminal fine is set to be considered alongside trillions of dollars in unsecured claims as part of Purdue’s bankruptcy proceedings.

Purdue agreed to pay $225 million toward a $2 billion criminal forfeiture, meanwhile, with the Justice Department foregoing the rest if the company completes a bankruptcy reorganization dissolving itself and shifting assets to a “public benefit company” or similar entity that steers the $1.775 billion unpaid portion to thousands of U.S. communities suing it over the opioid crisis.

A sentencing imposing those penalties is set to come down the line, near the time Purdue receives court approval for a bankruptcy reorganization.

(Reporting by Mike Spector in New York; Editing by Chris Reese and Giles Elgood)

Exclusive: OxyContin maker Purdue Pharma exploring bankruptcy – sources

FILE PHOTO: Bottles of prescription painkiller OxyContin pills, made by Purdue Pharma LP sit on a counter at a local pharmacy in Provo, Utah, U.S., April 25, 2017. REUTERS/George Frey

By Mike Spector and Jessica DiNapoli

(Reuters) – OxyContin maker Purdue Pharma LP is exploring filing for bankruptcy to address potentially significant liabilities from thousands of lawsuits alleging the drug manufacturer contributed to the deadly opioid crisis sweeping the United States, people familiar with the matter said on Monday.

The deliberations show how Purdue and its wealthy owners, the Sackler family, are under pressure to respond to mounting litigation accusing the pharmaceutical company of misleading doctors and patients about risks associated with prolonged use of its prescription opioids.

Purdue denies the allegations, arguing that the U.S. Food and Drug Administration-approved labels for its opioids carried warnings about the risk of abuse and misuse associated with the drugs.

Filing for Chapter 11 protection would halt the lawsuits and allow the drugmaker to negotiate legal claims with plaintiffs under the supervision of a U.S. bankruptcy judge, the sources said.

More than 1,000 lawsuits accusing Purdue and other opioid manufacturers of using deceptive practices to push addictive drugs that led to fatal overdoses are consolidated in an Ohio federal court. Purdue has held discussions to resolve the litigation with plaintiffs’ lawyers who have often compared the cases to widespread lawsuits against the tobacco industry that resulted in a $246 billion settlement in 1998.

A Purdue bankruptcy filing is not certain, the sources said. The Stamford, Connecticut, drug maker has not made any final decisions and could instead continue fighting the lawsuits, they said.

“As a privately-held company, it has been Purdue Pharma’s longstanding policy not to comment on our financial or legal strategy,” Purdue said in a statement.

“We are, however, committed to ensuring that our business remains strong and sustainable. We have ample liquidity and remain committed to meeting our obligations to the patients who benefit from our medicines, our suppliers and other business partners.”

Purdue faces a May trial in a case brought by Oklahoma’s attorney general that, like others, accuses the company of contributing to a wave of fatal overdoses by flooding the market with highly addictive opioids while falsely claiming the drugs were safe. The court proceedings will be televised.

Purdue tapped law firm Davis Polk & Wardwell LLP for restructuring advice, Reuters reported in August, fueling concerns among litigants including Oklahoma Attorney General Mike Hunter that the company might seek bankruptcy protection before the trial.

(Reporting by Mike Spector and Jessica DiNapoli in New York)