OxyContin maker Purdue Pharma LP will ask a bankruptcy judge today to pause litigation against the company and its owners over the objections of U.S. states that allege the company is trying to protect the controlling Sackler family, Reuters reported. Purdue’s request promises to be one of the most contentious of the company’s chapter 11 case, which was filed in September to try to implement a settlement proposal it values at more than $10 billion. Privately held Purdue said last month it needed to pause more than 2,600 lawsuits so the company can reduce legal costs and try to win over more plaintiffs to its proposed deal. The lawsuits accuse Purdue and the Sacklers of fueling a public health crisis by aggressively marketing opioids while downplaying their overdose risks, contributing to some 400,000 deaths from 1999 to 2017, according to U.S. statistics. The company said that it has the support of a majority of the local governments that brought the bulk of the lawsuits, although at least 24 states oppose the deal. Read more.
In related news, Bankruptcy Judge Robert Drain yesterday urged parties that will benefit from a proposed settlement with OxyContin maker Purdue Pharma LP to focus on addressing the opioid addiction crisis and avoid battling over the deal’s billions of dollars, Reuters reported. The outline of a proposed settlement that Purdue values at more than $10 billion was filed in the U.S. Bankruptcy Court in White Plains, N.Y., on Tuesday. The deal aims to resolve more than 2,600 lawsuits by states, local governments and other plaintiffs against Purdue and its Sackler family owners. The lawsuits accuse them of fueling a public health crisis by aggressively marketing opioids while downplaying their overdose risks, contributing to some 400,000 deaths from 1999 to 2017, according to U.S. statistics. “No one can ignore the individual people affected by this crisis,” Judge Drain said at a hearing yesterday. “So I hope that you all will be able to work together to use the money as wisely as possible.” Judge Drain urged the parties to consider ways to distribute settlement funds quickly, rather than follow the usual bankruptcy practice of evaluating each creditor claim before making payments. Read more.