Purdue Pharma Seeks More Time to Build Support for $7.4 Billion Opioid Settlement
Purdue Pharma, the company behind the addictive pain medication OxyContin, has requested more time to build support for a new $7.4 billion settlement that could complete its years-long effort to resolve thousands of lawsuits over its role in the deadly U.S. opioid epidemic. The company still needs to hammer out remaining details and seek buy-in from states, local governments, and other creditors that have sued the company and its Sackler family owners.
The settlement, announced on Thursday by several states’ attorneys general, proposes a formal bankruptcy plan before the end of February. However, the deal has not yet been reviewed by most of Purdue’s creditors, including the states, local governments, and individuals that have legal claims against the Sacklers.
Key terms of the settlement will be published next week, and the states that negotiated the deal are circulating it to other states to encourage them to support the deal. However, the settlement does not fully shut off lawsuits from states, local governments, or others who would prefer to opt out of the deal and instead sue the Sacklers.
U.S. Bankruptcy Judge Sean Lane, who is overseeing Purdue’s Chapter 11 proceedings, approved the company’s request to pause all opioid lawsuits against the Sacklers at least until the end of February. Lane said the company is making concrete progress toward a deal and encouraged creditors to be patient as the settlement develops.
The new deal comes seven months after the Supreme Court ruled that the Sacklers, who did not file for bankruptcy themselves, were not entitled to sweeping legal protections meant to give bankrupt debtors a fresh start. The settlement does not fully shut off lawsuits from states, local governments, or others who would prefer to opt out of the deal and instead sue the Sacklers.
West Virginia currently supports the deal, but it retains the ability to opt out and litigate separately. The deal is not yet binding even for the 15 states that negotiated it.