57°
The Stamford, Connecticut-based company submitted the plan to the US Bankruptcy Court for the Southern District of New York, Purdue said in a news release on Wednesday, Mar. 19. The reorganization increases the Sackler family's payout by $1 billion from a previous deal.
The plan will dissolve Purdue and transfer its assets to a new public benefit company focused on opioid crisis abatement. The Sacklers, who have had no direct involvement with Purdue since 2018, also won't have a role in the new company.
The updated bankruptcy filing comes about nine months after the Supreme Court stopped Purdue's attempt to get the Sacklers sweeping immunity from opioid lawsuits.
"Following the 2024 Supreme Court ruling, we doubled down on our commitment to work with our creditors to design a new plan that delivers unprecedented value to those affected by the opioid crisis," said Purdue board chair Steve Miller. "Today's filing is a major milestone in that effort. We and our creditors have worked tirelessly in mediation to build consensus and negotiate a settlement that will increase the total value provided to victims and communities, put billions of dollars to work on day one, and serve the public good."
Under the proposal, the Sacklers will contribute between $6.5 and $7 billion. The family would pay $1.5 billion immediately and the rest would be paid out over 15 years.
Purdue will also provide $900 million in cash on the day the plan takes effect. If the Sacklers' international pharmaceutical businesses sell for more than expected, an additional $500 million could be added to the settlement.
Unlike previous versions, the new plan requires creditors to opt in to receive their full settlement payments and those who decline can keep their right to take legal action against the Sacklers. The plan is one of the few opioid-related settlements that compensates individual victims directly, with more than $850 million allocated for those affected.
The agreement follows years of litigation against Purdue and the Sacklers for their role in the opioid crisis, which has killed hundreds of thousands of Americans. The company aggressively marketed OxyContin despite its highly addictive properties, fueling an epidemic that killed nearly 727,000 people in the US between 1999 and 2022, according to the Centers for Disease Control and Prevention.
The Sacklers and Purdue Pharma previously reached a $7.4 billion settlement with attorneys general from 15 states on Thursday, Jan. 23. The plan also mandates the release of more than 30 million internal Purdue documents, providing an unprecedented look into the company's marketing practices and interactions with regulators.
Once Purdue dissolves, its successor company will be run by an independent foundation. The nonprofit will focus on distributing opioid treatment and overdose reversal medications.
A hearing to approve the disclosure statement is expected in May.
Click here to follow Daily Voice Mansfield-Storrs and receive free news updates.
