Purdue Pharma files new bankruptcy plan for $7.4 billion opioid settlement.
Bankrupt drugmaker Purdue Pharma filed a new bankruptcy plan on Tuesday, a major step towards finalizing a proposed opioid settlement of at least $7.4 billion after a setback in the U.S. Supreme Court last year.
The payments are aimed at resolving thousands of lawsuits alleging that the company’s pain medication OxyContin caused a widespread opioid addiction crisis in the United States.
The formal bankruptcy plan filed Tuesday, in White Plains, New York, fleshes out the settlement with new details about how the money will be allocated to states, local governments and individuals harmed by the crisis.
The cash value of the plan assumes full creditor participation. Purdue said it expects widespread creditor support for the deal.
The company plans to begin soliciting votes and opt-in decisions from its creditors in May. After that process is concluded, the plan would be submitted to a U.S. bankruptcy judge for final approval.
Purdue’s new plan responds to that ruling by giving creditors the choice to opt in to the settlement if they wish to be paid. Those who do not wish to join the settlement are free to pursue lawsuits against the Sacklers, who have said they would vigorously defend themselves in court.
The Sacklers are putting up between $6.5 billion and $7 billion for the new settlement, a $1 billion increase over the deal that was rejected last year.
Purdue will pay $900 million of its own funds, and make several non-monetary concessions, including transforming itself into a public benefit company devoted to producing medicine for treating opioid use disorder and reversing overdoses.
Source: REUTERS
