Thursday, May 16, 2019

With Impending Lawsuits, Maker of OxyContin Contemplates Bankruptcy

As the opioid epidemic continues to wreak havoc on the lives of many, one of the companies responsible for making billions off of the prescription painkiller, OxyContin is facing consequences in the form of hundreds of lawsuits holding it responsible.

Purdue Pharma, the maker of OxyContin since 1996, is currently considering numerous legal options and exploring several eventualities due to the sheer amount of litigation it faces. One such possibility is for the company to file for bankruptcy, though no decisions have been made as of yet. 

However, the option of filing for bankruptcy has been seen as a possibility of high likelihood given that the privately held company has sought help with restructuring it over the past year. Members of the Sackler family, who own Purdue Pharma, have given large sums of money to several museums around the world. This seems much more understandable, given that according to a Massachusetts public filing, Purdue Pharma paid the family was paid more than $4 billion from 2007 to 2018.

Stalling Litigation 

Should Purdue decide to file for bankruptcy, it is likely that those proceedings would put a hold on litigation it is currently facing. Purdue is contemplating this decision as the first trial date continues to approach. Should it decide to move ahead with filing for bankruptcy, a federal bankruptcy judge is provided the discretion for how to proceed and what will happen to the claims of hundreds of local and state governments that have all chosen to sue it. 

The judge in question has the authority to allow claims against other drugmakers and distributors to move forward, while it continues to be handled separately. He or she may also choose to consolidate all claims or to continue on without Purdue. Alternatively, the bankruptcy filing may include a settlement with the plaintiffs involved in these suits.

Opioid Sold Under False Pretenses

According to the lawsuits in question, the time-released opioid was sold as a drug that had a low chance of triggering addictions. However, Purdue Pharma already knew this to be misguided and untrue. In fact, according to the U.S. Centers for Disease Control and Prevention, in 2017 alone, opioids were responsible for a record almost-48,000 deaths.


Increase of Illicit Opioid Use

As physicians have become more aware of the hazards of prescription opioids, and are paying more attention to what it is that they are prescribing, deaths involving illicit opioids such as fentanyl and heroin have increased. 

Purdue has maintained its innocence in all of this, pointing to the fact that its products were in fact approved by federal regulators as well as prescribed by doctors. 

This is not the first time that an organization facing big lawsuits has contemplated or claimed bankruptcy. For over 30 years asbestos companies have continued to do so and just last year, USA Gymnastics filed for protection while facing hundreds of lawsuits concerning sexual abuse by team doctor Larry Nassar. Should Purdue Pharma go the bankruptcy route, plaintiffs may feel pressured to settle with the company since a bankruptcy judge may make them feel that it is their best option for damages. 

Miami Valley Bankruptcy Can Help

If you or a loved one is facing any issues surrounding bankruptcy, it is important that you understand all of your options as well as the potential benefits and risks. At Miami Valley Bankruptcy, we work to help our clients make the decisions in their best interest while protecting themselves. To learn more or to schedule a free consultation, visit us online, or call us at 937-262-4789 today! 

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