By Dietrich Knauth
NEW YORK (Reuters) – Purdue Pharma said on Friday it needed more time to build support for a new $7.4 billion settlement that could complete the company's year-long effort to resolve thousands of lawsuits over its addictive pain medication OxyContin.
The company still needs to hammer out the remaining details and seek support from states, local governments, and other creditors who have sued the company and its owners the Sackler family over their roles in the deadly opioid epidemic in the US.
Purdue attorney Benjamin Kaminetsky said at a court hearing in White Plains, New York that the company was “almost there” on a deal announced Thursday by several state attorneys general and would propose a formal bankruptcy plan before the end of February.
U.S. Bankruptcy Judge Sean Lane, who is overseeing Purdue's Chapter 11 case, said the company is making definite progress toward a deal and approved its request to delay all opioid lawsuits against the Sacklers until at least the end of February .
The bankruptcy case has prevented litigation from proceeding against the Sacklers and Purdue, since the company entered Chapter 11 in 2019, and Lane has granted several short-term extensions to the litigation truce in recent months.
“We've been doing this for some time now, and hopefully we're getting to the end,” Lane said Friday.
Purdue filed for bankruptcy in 2019 in the face of thousands of lawsuits accusing it and members of the Sackler family of fueling the epidemic through fraudulent marketing of OxyContin. Drug manufacturers, distributors, pharmaceutical operators and others have collectively agreed to pay about $50 billion to resolve lawsuits and similar investigations related to the U.S. opioid crisis.
The new agreement, supported by 15 states, offers the company a new chance to end its long-running bankruptcy after the US Supreme Court struck down its previous opioid settlement. But he faces a long and uncertain road before the settlement is approved and money can begin to flow to states, communities and individuals who were harmed by the crisis.
The deal has not yet been reviewed by most of Purdue's creditors, including the states, local governments, and individuals who have legal claims against the Sacklers.
Key terms of the settlement will be announced next week, said David Nachman, an attorney representing New York state. The states that negotiated the agreement, including New York, California, Texas and West Virginia, are circulating it to other states to encourage them to support the deal.