Revised Bankruptcy Proposal by Purdue Pharma: Up to $7 Billion Settlement from the Sacklers
Rewritten Article:
Title: Purdue Pharma Proposes New Bankruptcy Plan With $7.4 Billion Settlement
Quick Shares:
Highlights:
Purdue Pharma restructured its Chapter 11 filing in a New York court last week, revealing a new bankruptcy plan with over $7.4 billion in settlements for victims of the opioid crisis. Here's what you need to know about Purdue's revised plan:
Key Points:
- Moving forward, the drug manufacturing company will be dissolved, and a new entity focused on eradicating the opioid crisis will take its place.
- The Sackler family, historically at the helm of Purdue, will not own shares in the new company.
- The settlement allows creditors to either accept their payments or pursue legal action against the Sacklers.
- The $7.4 billion total would break down to around $6.5 billion from the Sacklers, paid in installments over 15 years, starting with an initial $1.5 billion upon plan approval.
- Additional Sackler contributions could be forthcoming if the sale value of their international pharmaceutical companies tops a certain threshold.
- Purdue will contribute all its assets, including $900 million in cash, to the settlement.
- Uninterested creditors still have the option to walk away and sue the Sacklers individually.
Differences Between the Old and New Plans:
- The previous settlement would've seen the Sacklers shell out $6 billion, while now they'll pay up to $6.5 billion.
- Previously, the Sacklers would be immune from further legal action; however, the current plan does not explicitly grant such immunity.
- The initial settlement approved between Purdue and plaintiffs had valued at $3 billion, later revised to $4.5 billion, but was dismissed by the Supreme Court in 2024.
What's Next:
The new settlement plan intends to serve the needs of victims, support public health initiatives, all while winding down Purdue Pharma. Meanwhile, the Sacklers still maintain their position that they acted lawfully, alleging their role in OxyContin's unexpected contribution to the opioid crisis.
Leaving a Mark:
As of February 2024, the Sacklers' net worth was estimated at $5.2 billion, a significant drop from $10.8 billion in 2020. They exited the company's board in 2018 and, ever since, have had no involvement in Purdue Pharma.
Background:
- Purdue Pharma: Developed infamous prescription painkiller OxyContin, tied to the ongoing opioid epidemic.
- The Sacklers: Owned and managed the company until its filing for bankruptcy in 2019. Faced charges and lawsuits for their involvement in the explosive opioid crisis.
Details:
Sources:1. The Wall Street Journal: "Purdue Pharma Files New Bankruptcy Plan, Ups Settlement Offer Amid Legal Hurdles"2. Forbes: "Purdue Pharma Files New Bankruptcy Plan, Offering More Than $7 Billion Settlement For Opioid Crisis"3. CNN: "The Sacklers made billions from OxyContin. Now, they’re trying to avoid the consequences."4. The New York Times: "Purdue Pharma Bankruptcy Plan Sets Up New Company for Opioid Crisis Fight"
Shake things up, keep informed with our breaking news text alerts. Text "Alerts" to (201) 335-0739 or sign up here.
- The billionaire Sackler family, who previously managed Purdue Pharma, will pay up to $6.5 billion as part of the new bankruptcy plan, an increase from the initial $6 billion proposal.
- Purdue Pharma, the company known for developing Oxycontin and at the heart of the opioid crisis, will dissolve and be replaced by a new entity focused on eradicating the crisis, according to the proposed bankruptcy plan.
- Under the new bankruptcy plan, targets can either accept their payments from Purdue or pursue legal action against the Sackler family, who will not own shares in the new company.
