OxyContin pills on sale in a pharmacy in Montpelier, Vt. Purdue Pharma, manufacture the highly addictive drug. Toby Talbot / AP hide caption
Toby Talbot / AP
Toby Talbot / AP
Under a bankruptcy plan filed late Monday evening, Purdue Pharma would pay approximately $ 500 million in cash upfront to settle hundreds of thousands of claims for damages related to the company’s role in the deadly opioid epidemic.
The company said additional payments would be spread out over the next decade, including approximately $ 4.2 billion in installments pledged by members of the Sackler family who own the company.
No set schedule has been set for most of these payouts, although Purdue Pharma predicted that additional payouts of up to $ 1 billion would be made by 2024.
Two dozen attorneys general immediately rejected the plan.
They issued a joint statement describing Purdue as a “criminal enterprise” and calling for more money upfront to help opioid addict communities pay for treatment and public health services.
“What the Sacklers offer is a way to structure payments in a way that is convenient for them,” said Maura Healey, Massachusetts attorney general.
“This plan doesn’t go as far as it needs to be,” said North Carolina attorney general Josh Stein, who told NPR a final deal would have to include “more money from the Sacklers.”
Sacklers increase their offer
Under the proposed restructuring plan, which has yet to be approved by a federal bankruptcy court in White Plains, NY, the Sacklers would give up ownership of Purdue Pharma’s domestic operations.
They would not admit any wrongdoing and would retain control of their overseas subsidiaries for at least the next seven years.
Critics say the Sacklers would remain one of the richest dynasties in the United States, although the role of their company plays an important role Addiction crisis that has killed more than 450,000 Americans.
“That’s the most disturbing thing, the idea that they will get away with it,” said Nan Goldin, an activist campaigning to remove the Sackler name from museums around the world. “For me, this is the one percent perversion of justice.”
The privately held company has now twice approved the illegal marketing of opioid drugs in separate pleas deals with the Ministry of Justice, once in 2007 and again in the last year.
Under these agreements, Purdue Pharma admitted to lying to doctors and patients about the safety of its flagship product, OxyContin, which became one of the most abused prescription narcotics in the United States.
The sale of the highly addictive opioid also made the Sacklers fabulously rich and from the end of the nineties earned income in the double-digit billions.
Speaking of which during a congressional hearing in DecemberFormer board member Dr. Kathe Sackler regretted Purdue’s involvement in the opioid crisis, but said she had personally done nothing wrong.
“There is nothing I can find otherwise, depending on what I believed and understood at the time,” she said.
The $ 4.2 billion personal money offered by members of the Sackler family was more than $ 1 billion higher than last year.
In October, the family paid $ 225 million in damages under last year’s deal with the DOJ, without admitting any wrongdoing.
A new company that promises to “tackle the crisis”
If approved, the bankruptcy plan provides for Purdue Pharma to be reborn as a new company independent of the Sacklers.
The undisclosed company would continue to sell a wide variety of drugs, including OxyContin. Future profits would flow into a variety of trusts that would indirectly own the company.
In the background, company employees said financial aid will be flowing to individuals, organizations and communities affected by the opioid epidemic.
The new company would also commit to making drugs like buprenorphine and naloxone, which help reduce opioid addiction and help people recover from overdoses.
Purdue said these drugs would be distributed to communities at a low cost.
“With drug overdose still at record levels, it is time to use Purdue’s assets to help manage the crisis,” said Steve Miller, president of Purdue Pharma, in a statement. “We are confident that this plan will achieve this critical goal.
Company officials also predicted that Purdue Pharma’s assets could be embroiled in costly legal disputes for years if the bankruptcy plan were to dissolve.
However, many attorneys general described the scheme as too complicated, arguing that it would “unduly involve governments and other creditors in the business of a private company.”
Massachusetts Attorney General Healey said she preferred to see Purdue Pharma “wind up and cease operations”.
Critics also noted that much of the deal that Purdue Pharma reached, valued at around $ 10 billion, would come in the form of inexpensive drugs rather than cash, which many communities would prefer.
“Right now, millions of people across the country are desperately dependent on opioids. They need help and they need it now,” said the joint statement from nearly half of the country’s attorneys general.
Experts interviewed by NPR said the plan, developed over months of negotiations, is likely to serve as the framework for Purdue Pharma’s final liquidation.
Details will almost certainly change before the reorganization gets final approval from Judge Robert Drain.
In an official disclosure statement filed with the court, Purdue Pharma admitted that it would never be able to meet all of the opioid claims it faces.
As part of these bankruptcy proceedings, more than 614,000 individual lawsuits were filed against the company.
This is a moment of reckoning for many American companies that manufactured, sold, and distributed opioids, even as overdose deaths increased.
AmerisourceBergen, Cardinal Health, Johnson & Johnson and McKesson have reached a preliminary settlement with local and state authorities worth $ 26 billion.
Consulting giant McKinsey settled opioid claims last month and agreed to pay $ 573 million for its role in helping Purdue Pharma’s opioid sales.
Walmart, meanwhile, is embroiled in its own legal battle with the Justice Department, which filed a lawsuit against the retail giant in late December for alleged “illegal” opioid sales practices in its pharmacies.