Opioid drugmaker Purdue Pharma explores bankruptcy to dodge lawsuit liabilities

By PharmaCompass

2019-03-07

Impressions: 143 Article

Purdue Pharma, the opioid drugmaker built by Richard Sackler that reaped billions in profits through its painkiller OxyContin, said this week it is considering options to file for bankruptcy in an effort to address the significant liabilities arising out of lawsuits that allege its role in the deadly opioid epidemic.

Purdue Pharma has been battling roughly 2,000 lawsuits at federal and state courts. The lawsuits accuse opioid manufacturers such as Purdue of using deceptive practices to push addictive drugs that led to fatal overdoses.

One of the publicly discussed lawsuit launched by the Massachusetts attorney general against the drugmaker alleges that the company “seeded the state’s opioid crisis by misleading the public and prescribers about its drugs’ risk of addiction and overdose.”

If Purdue files for bankruptcy, it comes under the purview of Chapter 11 protection under the Bankruptcy Code of the US, which would in turn halt the lawsuits and allow Purdue to negotiate legal claims with plaintiffs under the supervision of a bankruptcy judge.

Endo International Plc and Insys Therapeutics Inc are two other companies that have been cited in lawsuits related to the US opioid crisis.

In 2017, US reported 47,600 deaths — a six-fold increase from 1999 — caused due to an overdose of opioids, including prescription painkillers, heroin and fentanyl, according to the US Centers for Disease Control and Prevention.

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