Purdue Pharma, the drugmaker accused of playing a major role in the opioid epidemic, filed for Chapter 11 bankruptcy protection in New York on Sunday. The move was expected after the company and its owners, the Sackler family, reached a tentative settlement with 24 states and thousands of local governments last week. Under the settlement, the Sacklers would wash their hands of Purdue, putting up $3 billion of the family's estimated $13 billion fortune and turning Purdue into a trust, with profits from OxyContin and other drugs going to the plaintiffs.
This isn't the end of the road for Purdue yet, though, as The Associated Press explains.
The thousands of plaintiffs who have not yet signed on to the settlement, including about half of U.S. states, will likely object to the settlement in bankruptcy court, and there are open questions about whether the proposed settlement is really worth $12 billion and how the money would be distributed. Purdue and the lawyers representing the parties that agreed to the settlement argue that nobody is served by long, costly litigation.
Recent court filings suggest much of the Sackler wealth has been stashed offshore since 2008, making it likely out of reach of U.S. plaintiffs, especially if the company dissolves without admitting wrongdoing or being found guilty in court. "The Sacklers are going to be left with plenty of money after this,'' Adam J. Levitin, a bankruptcy expert at Georgetown Law, tells The Washington Post. "There is a desire that the Sacklers pay some blood money, but it's never going to be enough to make everyone happy.''
OxyContin accounts for only a slice of the opioid drugs sold in the U.S., but Purdue's aggressive and misleading marketing is blamed for helping spark the opioid addiction crisis. Since 1999, more than 200,000 people have died from overdoses of prescription opioids.