Members of the billionaire Sackler family that own Purdue Pharma LP are close to a deal to increase their contribution to the OxyContin maker’s sweeping opioid settlement, court papers show.
The family and a handful of state attorneys general that have been opposing Purdue’s opioid settlement are nearing a deal that would provide a “substantial” additional contribution on top of the $4.325 billion the company’s owners already pledged, according to the court documents.
The potential deal follows mediation sessions that spanned 100 phone calls and two lengthy in-person gatherings.
U.S. Bankruptcy Judge Shelley C. Chapman is overseeing the mediation and delivered the update in a written report Monday evening. She has spoken directly with members of the Sackler family, their lawyers, and attorneys general that worked to overturn the settlement on appeal, according to the report. The dissenting states include Washington, Connecticut and Maryland.
Chapman asked to extend the mediation until Feb. 7 so the parties can finish settlement negotiations. Purdue is due back in bankruptcy court on Tuesday.
Purdue’s settlement would allow the company to resolve trillions of dollars in claims against it over its role in the opioid crisis. The deal calls for handing nearly all of the drugmaker’s assets over to the states, cities and counties suing it for its handling of OxyContin, and would provide billions of dollars to addiction abatement initiatives.
But the plan would also provide protection for Purdue’s owners from future opioid lawsuits, a dynamic that has rankled some high-profile politicians, personal injury victims and an arm of the U.S. Justice Department. A new, larger settlement that has the backing of once-dissenting state attorneys general would remove a significant obstacle to getting the deal done, but may not smooth the path completely.
U.S. District Judge Colleen McMahon in December struck down Purdue’s settlement on appeal. She found that its bankruptcy judge doesn’t have the authority to give members of the Sackler family the legal protection the deal called for, dealing a startling blow to a long-controversial aspect of bankruptcy law.
The bankruptcy case is Purdue Pharma LP, 19-23649, U.S. Bankruptcy Court for the Southern District of New York (White Plains).
