OxyContin maker Purdue Pharma, blamed for helping to fuel a deadly opioid crisis, said Friday that a US bankruptcy judge will sign off on a deal to settle thousands of lawsuits against the company, which will cease to exist.
Purdue and other opioid makers and distributors were accused of encouraging free-wheeling prescription of their products through aggressive marketing tactics while hiding how addictive the drugs are.
Earlier this year, several US states reached a $7.4 billion settlement with the Sackler family and Purdue, the company they owned for decades, that will see funds routed to affected communities and individuals.
Federal judge Sean Lane said in a New York court that he would sign off on the company Chapter 11 plan, with a formal ruling expected at a hearing on Tuesday.
“Today cements the end of a long chapter, and brings us very near to the end of the book for Purdue,” board chairman Steve Miller said in a statement. “Soon, Purdue will cease to exist.”
“We will now commence the process of satisfying all outstanding requirements for Purdue to emerge from bankruptcy so that resources from the settlements can flow to communities across America as quickly as possible,” he said.
The Sacklers will pay $6.5-7.0 billion while the company will pay $900 million.
A separate fund of $865 million will be created to compensate victims.
Purdue Pharma’s OxyContin, one of the main prescription opioids that stoked the US addiction and overdose epidemic beginning in the early 2000s – Copyright AFP/File Adrian Dennis
The remnants of Purdue will become Knoa Pharma, a company owned by a foundation, that will provide opioid use disorder treatments and overdose reversal medicines, “with no obligation to maximize profits,” the company said.
For many people, opioid addiction begins with prescribed pain pills, such as OxyContin, before they increase their consumption and eventually turn to illicit drugs such as heroin and fentanyl, an extremely powerful synthetic opioid.
The Sacklers have consistently denied wrongdoing over the opioid crisis.
The company statement says the family “have had no involvement in Purdue since the end of 2018,” while officials said the January settlement had ended the Sacklers’ control of Purdue Pharma.
