NEW YORK – Purdue Pharma is moving towards filing bankruptcy — a move that could help it manage liability — as it faces a mountain of opioid crisis-related lawsuits, according to a report Monday.
Purdue Pharma, manufacturer of prescription opioid OxyContin, is working with restructuring experts for a potential bankruptcy filing, “people familiar with the matter” said according to Reuters.
The drugmaker did not address Monday’s report but told The Daily Caller News Foundation in a statement:
As a privately-held company, it has been Purdue Pharma’s longstanding policy not to comment on our financial or legal strategy. We are, however, committed to ensuring that our business remains strong and sustainable. We have ample liquidity and remain committed to meeting our obligations to the patients who benefit from our medicines, our suppliers and other business partners.
Purdue Pharma is working with restructuring advisers including New York-based AlixPartners LLP, according to a source cited by TheWSJ. The company hired law firm Davis Polk & Wardwell as restructuring counsel in 2018, according to TheWSJ.
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If Purdue Pharma files for Chapter 11 protection, the lawsuits brought by roughly 1,600 cities, counties and states would be halted and the drug company could negotiate with plaintiffs under a U.S. bankruptcy judge’s supervision, reported Reuters.
Purdue Pharma has been accused of helping create the opioid crisis through the aggressive marketing of its products — and some analysts blame the way Purdue Pharma promoted OxyContin for the roughly 200,000 prescription opioid-related overdose deaths since 1999, according to ProPublica.
The company denies the allegations, such as those in Massachusetts Attorney General Maura Healey’s suit alleging that the company misled doctors and patients about the risks of opioids to increase prescriptions.
“They don’t want to accept blame for this. They blame doctors, they blame prescribers and worst of all, they blame patients,” Healey told CBS News in January.
Her remark was likely targeted at a previously unseen email from Richard Sackler, then-president of Purdue Pharma. Many communications by company executives were revealed in January in a 312-page filing by Healey’s office.
“[W]e have to hammer on abusers in every way possible,” Sackler wrote in a 2001 email quoted in the filing. “They are the culprits and the problem. They are reckless criminals.”
OxyContin was Purdue Pharma’s biggest revenue stream with $35 billion in sales between 1995 and 2015. It helped make the Sacklers the 19th-richest family in the U.S. with an estimated $13 billion net worth, according to Forbes. A 2017 TheDCNF investigation found no evidence the Sackler family was using its vast personal wealth to help recovering opioid addicts.