Purdue Opioid Settlement Contingent on DOJ Probes

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Purdue Pharma LP’s plan to turn over operations to creditors and see its owners, the Sacklers, exit the opioid business is contingent on resolving ongoing probes by the U.S. Justice Department, the Wall Street Journal reports. The disclosure emerged in a proposal Purdue, the maker of OxyContin, filed in U.S. Bankruptcy Court in New York that lays out details of the company’s plan to resolve its sprawling opioid liabilities. Purdue is in bankruptcy court facing 2,600 lawsuits brought by states and municipalities accusing the drugmaker of helping to fuel the opioid crisis by aggressively marketing opioid painkillers. The company sought bankruptcy in September, saying it had a deal in hand with 24 states and thousands of local governments that it valued at as much as $12 billion. Another 24 states oppose the proposed settlement and question its valuation.

The new filing shows that before any deal can go through, Purdue and the Sacklers must resolve with the Justice Department “all potential federal liability arising from or related to opioid-related activities.” If the economic terms of a DOJ settlement are inconsistent with the bankruptcy deal, state and local governments have the right to back out. Purdue has been in talks to resolve multiple civil and criminal Justice Department probes related to OxyContin. Those include investigations by the U.S. Attorney’s offices in New Jersey, Connecticut and Vermont, as well as the main Justice Department. The settlement calls for the Sackler family to “no longer be engaged in the opioid business,” an outcome that plaintiffs in support of the deal say is crucial. Lawyers representing thousands of cities, counties and Native American tribes said Wednesday the proposed settlement would help Purdue avoid a free-fall bankruptcy and increases “the chance that we will be able to put these assets to work for the American public within 12 to 16 months.”

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