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Home / US / Purdue Pharma, manufacturer of OxyContin, files for bankruptcy

Purdue Pharma, manufacturer of OxyContin, files for bankruptcy



The bankruptcy will also increase the use of legal disputes over how much of the personal assets owned by the billionaire family Sackler Purdue will be available to compensate the plaintiff. Several states that have rejected the proposed settlement have accused the family of having spent billions of dollars out of the company's coffers in the last decade to protect the money from expected court rulings.

"The controversial article is about how much The Sacklers need to step in for the business to work," said Adam J. Levitin, a professor specializing in bankruptcy at Georgetown Law.

Under the agreement announced last week, more than 2,000 small government plaintiffs and 24 states have agreed to liquidate the company and contribute $ 10 to $ 12 billion to Sackler. However, the settlement is controversial and a number of states have resisted these conditions.

Billing, in which no misconduct is allowed, would restructure Purdue during bankruptcy into a trust that would continue to produce OxyContin. and an overdose of "life-saving appliances" that are distributed free of charge to communities across the country.

"We hope and expect that an increasing number of states will view this as a much better outcome for them than for We must go into the mire of litigation that would basically devour all of the company's resources. said Steve Miller, chairman of Purdue, in a teleconference with reporters on Sunday evening.

A person familiar with the matter who spoke on the subject According to Purdue, $ 250 million was spent on litigation costs this year [19659010] The proposed $ 3 billion minimum Sackler family contribution could be deri Due to the sale of a related, family-owned international drug company called Mundipharma, it was considered insufficient by attorney general who rejected the plan.

New York, Massachusetts, Connecticut, and other states argue that the Sackler family has made far more money in a number of trusts and investment firms, including in offshore tax havens such as the Channel Islands, which should be made available to plaintiffs The Sackler family is estimated at $ 13 billion

The family is expected to argue that billions of dollars deducted from Purdue Pharma were legitimate dividends. Levitin said there will be restrictions on what can be "reclaimed" from the family's far-off financial empire, among other things, because the government's statutes of limitations prevent plaintiffs from considering transactions that date back more than a few years.

"These are the sackcloths. There's a lot of money left after that," Levitin said. "There is a desire for the Sacklers to pay some blood money, but it will never be enough to make everyone happy."

The Sackler family issued a statement on Sunday evening in which settlement and bankruptcy were referred to as a "historic move" to address a "tragic situation of public health".

"We hope that the bankruptcy reorganization process currently under way will end our ownership of Purdue and ensure that its assets are used for the public good," the family said. 19659018] As part of the preliminary settlement, the bankruptcy will mean the end of a company bought by three immigrant Sackler brothers in 1952. In the late 1990s, the Sacklers Purdue had made a highly profitable company selling oxycodone tablets under the brand name OxyContin. The company marketed OxyContin as a safer form of narcotic painkillers when it was introduced in 1996 because of its time-delayed effect. However, the drug was blamed for a surge in addiction, prescription drug abuse and fatal overdoses.

General sales of the drug, as well as generic versions and other oxycodone and hydrocodone tablets, which have been widely sold by a handful of large companies according to the authorities, qualify for subsequent waves of heroin and fentanyl abuse in communities across the country, especially in Appalachian Mountains, created

More than 200,000 people have died from prescription opioid overdoses since 1999. Another 200,000 have died from overdoses due to heroin and illegally obtained fentanyl – pledging allegations by the federal government to have charged misleading regulators, doctors and patients with drug addiction. The company paid more than $ 600 million in fines and other payments.

Nevertheless, under the strict control of the OxyContin family, Purdue Pharma continued to market aggressively and fueled the company's growing epidemic of drug addiction. Lawsuits are also pending against manufacturers, distributors and retailers of oxycodone generics.

As the billions of dollars in sales continued, the family members controlling the company began transferring large pieces of money from the company in 2008

"Between 2008 and 2018, they ordered Purdue to collect $ 11 billion (including $ 11 billion) Tax distributions) to partner companies, foreign companies and, ultimately, trusts created for the benefit of the Sackler families. & # 39; & # 39; said recently revealed parts of a lawsuit filed this year by Oregon's Attorney General.

Such transfers were cited last week by some of the 26 states that rejected the preliminary settlement agreement. These states also said that the price of $ 10 to $ 12 billion appears out of line for comparison.

But Paul Hanly, co-lead counsel for plaintiffs who sued Purdue, said local governments had accepted the preliminary settlement because he's a better bet than the alternative he "probably spent a decade or more before Bankruptcy Court "and at the end probably a ham sandwich for our customers remains, the communities that suffer."

Joel Achenbach and Lenny Bernstein contributed to this report.


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