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The company that has made billions of dollars selling the prescription painkiller OxyContin said Wednesday it is considering legal remedies, including bankruptcy, which could overturn hundreds of lawsuits claiming to have played a major role in the opioid crisis in the United States.
"As stated by the company, it is exploring and preparing for all sorts of contingencies and options, given the number of litigation the company is currently facing," said the spokesman. Purdue Pharma, Robert Josephson, in an email to The Associated Press. "No decision has been taken to file for bankruptcy, there is no timetable."
Such an approach was considered a serious possibility since the private company hired a manager and consultants specializing in business restructuring assistance over the last year.
The company is owned by members of the Sackler family, who donate money to museums around the world, including the Smithsonian Institution in Washington, the Metropolitan Museum of Art in New York and Tate Modern in London. A court record released in Massachusetts earlier this year claims that family members received more than $ 4 billion worth of Purdue from 2007 to 2018.
The first trial date is approaching in hundreds of lawsuits aimed at keeping the company and other players in the pharmaceutical sector responsible for the opioid crisis on a national scale.
A bankruptcy proceeding would probably put a pause in this litigation, at least for Purdue.
A federal bankruptcy judge would have broad discretion on how to proceed, which could affect the claims of hundreds of local and state governments that have filed lawsuits. The judge could leave claims against other drug manufacturers and gateway distributors while Purdue is being dealt with separately, group them together or let other claims continue without Purdue's involvement. Another possibility is that the bankruptcy filing includes a settlement with the plaintiffs in the lawsuits.
The lawsuits claim the company based in Stamford, Connecticut, aggressively sold OxyContin as a low-risk drug, although it knew it was not true.
Since the introduction of OxyContin, an extended-release opioid, in 1996, addiction and opioid overdoses have increased. In 2017, opioids were involved in nearly 48,000 deaths – a record, according to US Centers for Disease Control and Prevention.
In recent years, there have been more deaths related to illicit opioids, including heroin and fentanyl, than prescription drug forms. This shift has occurred with the growing awareness of the dangers of prescription opioids and the increased caution of prescribers.
Purdue's medications are just a slice of the prescribed opioids, but critics blame it largely on the company because it has developed both the drug and an aggressive marketing strategy.
According to a lawsuit filed by the Massachusetts Attorney General, the company pushed big sales of OxyContin early on. This meant persuading doctors who had hesitated to prescribe painkillers as powerful as this one was safe.
Purdue pointed out in court that its products had been approved by federal regulatory authorities and prescribed by doctors.
A federal judge overseeing more than 1,300 cases against Purdue and other companies has pushed parties to reach a grand settlement that would make a difference in the opioid crisis. Judge Dan Polster, based in Cleveland, has scheduled a lawsuit for claims filed by Ohio's Cuyahoga and Summit counties in October.
A state court in Oklahoma has scheduled a lawsuit in a case brought by that state in May. If it were to be the subject of a lawsuit, it would be the first in the wave of recent complaints against opioid companies.
Purdue's statement to the PA came the same day the Washington Post published an article in which the company's president and chief executive, Craig Landau, acknowledged that bankruptcy was under consideration.
A lawyer suing Purdue on behalf of clients, including the city of Albuquerque and the state of Utah, said it was long believed that Purdue could not afford to pay the huge amounts sought in lawsuits. .
"I do not think there is enough money in this business to pay the damages claimed," said Jonathan Novak.
Fr. Gluck, a professor at the Yale Law School who followed the case, said that even if the trial was going on in Oklahoma, "no one will be paid … without resorting to the bankruptcy court, once Purdue has filed his case ".
There is a tradition of bankruptcy claims of organizations facing heavy lawsuits. Dozens of asbestos companies have done so since the 1980s. Last year, USA Gymnastics sought the protection of its team doctor, Larry Nassar, for doing the job. subject to prosecution. Earlier this year, Pacific Gas & Electric Corp. had filed for bankruptcy protection, as it risked billions of dollars in damages resulting from lawsuits for catastrophic fires in California.
Vincent Buccola, a lawyer and professor of business ethics, said Purdue might try to avoid going to court in states heavily impacted by the opioid epidemic.
"This is not the jury you want to face," said Buccola, a professor at the University of Pennsylvania. "So you can try to end this litigation and consolidate it before a bankruptcy judge who, you hope, will be more supportive."
A bankruptcy judge could put pressure on plaintiffs to settle their affairs with the company if they want to get damages, said Buccola.
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