OxyContin Maker Purdue Pharma Goes Bankrupt

BusinessOxyContin Maker Purdue Pharma Goes Bankrupt

OxyContin Maker Purdue Pharma Goes Bankrupt

Is the opioid crisis coming to an end in the United States? Purdue Pharma, the company that designed OxyContin, filed for Chapter 11 of bankruptcy last week.
Thousands of families have sued the company as OxyContin as the latter was considered being the main trigger for the opioid crisis in the past years in the United States. So far, Purdue is involved in more than 2,600 lawsuits across the country.
Several states have already been contesting the filing’s terms – such as Massachusetts and New York – where hundreds of deaths have been related to OxyContin use. At the moment, more than 24 states have agreed on the filing.

$3 billion cash to plaintiffs

Purdue Pharma, the company that designed the painkiller OxyContin filed for bankruptcy in the upstate New York, right after an attempt to find an amicable agreement with several states – including New York – that were suing it, “over the toll of opioids”, reported the Associated Press.

The “tentative deal” was worth up to $12 billion, but several states. “This settlement framework avoids wasting hundreds of millions of dollars and years on protracted litigation. and instead will provide billions of dollars and critical resources to communities across the country trying to cope with the opioid crisis,” said Steve Miller, chairman of Purdue’s board of directors, said in a statement.
He added: “We will continue to work with state attorneys general and other plaintiff representatives to finalize and implement this agreement as quickly as possible.”
As for now, the owner of the company, the Sackler family, has agreed to retribute $3 billion in cash to the plaintiffs.

Sackler’s fortune is still hidden

While the Sackler’s family donation seem generous, it looks like a generous part of the profits OxyContin generated has been placed under-the-radar.
As the New York Times confirmed, while the United States were undergoing a major health crisis for almost 20 years, the Sacklers “transferred billions of dollars from Purdue to shell corporations and private accounts”.
According to the US law, such transfers could qualify for“fraudulent conveyance,” which means that the filing of the bankruptcy could be “against litigation”, highlighted the New York Times.

Read on Alvexo: “US Congress Held Sessions to Pass new Marijuana Laws”

A powerful “misbranding”

Last but not least, Purdue Pharma has pleaded guilty to federal charges which accused the company of –“misbranding” and “marketing of a powerful opioid.”

According to the Centers for Disease Control and Prevention, more than 700,000 people died in the United States from 1999 to 2017 of drug overdoses. In 2017, a study showed that opioid was involved in more than 68% of the overdoses.

As a matter of fact, the Sackler family “violated individual states’ consumer protection and fraud laws,” which means that the family itself as a private entity could also be sued in several states, in addition to the 2,600 active lawsuits against the company.
As the family’s fortune is estimated at $13 billion, it looks like the Sacklers might see a drastic cut on their wealth – while the latter was, largely, a result of the sale of OxyContin.