Purdue Pharma, accused of fostering the US opioid crisis with its drug OxyContin, filed for bankruptcy protection in a New York court, after a tentative settlement deal faced opposition from multiple states.
The company filed for chapter 11 bankruptcy in White Plains, New York on Sunday evening, as part of its efforts to finalize a settlement with state and local governments, which sued the pharmaceutical giant en mass for its role in the nation’s deadly opioid crisis.
The much-anticipated filing aims to help the company to shield itself from 2,600 lawsuits, including from 26 states. About 200 people taking the deadly drug died every day.
New York’s attorney general has uncovered over $1 billion in wire transfers by the Sackler family and accused the OxyContin magnates of trying to shield their wealth from mounting lawsuits over their role in the opioid crisis.
The money passed through several Swiss bank accounts, indicating the family may have tried to hide profits from the sale of drugs that have killed hundreds of thousands of Americans over the past two decades as their legal troubles began to pile up.
Numerous plaintiffs accused the company of making huge profits from selling the painkiller, first introduced in 1996.
On the other hand they are downplaying its addictive qualities, thus fueling the US opioid crisis, which has seen over 200,000 people dying as result of overdoses with prescription drugs from 1999 to 2017.
The bankruptcy announcement comes several days after the Sackler family behind the controversial drug maker reached a tentative multi-billion-dollar settlement with 23 states, which envisages it paying the sum over seven years while not admitting guilt.
Overall, Purdue is set to fork out nearly $12 billion to state and local authorities under the deal, including $3 billion that would come directly from the Sacklers, who would also give up the control of the company to avoid extended liability.
The proposed settlement requires the company to file for bankruptcy, which it ultimately did on Sunday. Not everybody is, however, on board, with some states arguing that the company must also offset the costs of treatment and incarceration.
Half of the states have not yet signed on to the deal, and several states, including NewYork, Massachusetts, Connecticut, and Wisconsin, have rejected it outright, vowing to push for the litigation to go forward, instead of shielding the financial misconduct.
RT. com / ABC Flash Point News 2019.