Purdue Pharma Wins Short Window to Negotiate New Sackler Deal

Purdue Pharma LP secured a two-month window to negotiate a new pact with members of the Sackler family as the OyxContin maker and its owners brace for a potential wave of civil opioid lawsuits after the US Supreme Court scuttled an earlier $6 billion settlement.

Bloomberg
First Published10 Jul 2024, 02:53 AM IST
Purdue Pharma Wins Short Window to Negotiate New Sackler Deal
Purdue Pharma Wins Short Window to Negotiate New Sackler Deal

(Bloomberg) -- Purdue Pharma LP secured a two-month window to negotiate a new pact with members of the Sackler family as the OyxContin maker and its owners brace for a potential wave of civil opioid lawsuits after the US Supreme Court scuttled an earlier $6 billion settlement.

Judge Sean Lane said during a Tuesday court hearing in New York that he’d extend for 60 days an injunction that, for years, has paused opioid litigation against the billionaire family while Purdue, government authorities and victims lawyers attempted to effectuate the earlier settlement.

Advisers who negotiated the earlier deal will attempt to cut a new agreement during the two-month window that complies with the Supreme Court’s ruling. Such a settlement, if successful, would likely compensate victims and provide billions of dollars to fund programs to combat the nation’s opioid addiction crisis. 

The talks are widely supported by Purdue creditors, state authorities and other constituencies and the related injunction was not sought by members of the Sackler family, Lane said.

Although Lane could decide in September to extend the injunction, lawyers for opioid victims indicated Tuesday they’re prepared to sue the Sacklers if negotiations don’t result in a new deal. A committee representing some states and cities said in a court filing they’d prefer to strike a revised deal but that preparing for litigation will either aid negotiations or be “a necessary first step toward obtaining the judgments that Purdue’s creditors deserve.”

If negotiations fail, Purdue has said it would back efforts by an official committee of creditors to recover more than $11.5 billion it says Sackler family members shifted offshore in the years preceding Purdue’s 2019 bankruptcy. The Sacklers dispute the allegations and have said that roughly half the money transferred from Purdue was paid in taxes.

Arik Preis, a lawyer representing opioid victims and other Purdue creditors, said the earlier settlement would have stripped substantial wealth from the drugmaker’s owners. Instead, Preis said the Sacklers have gotten richer while the earlier settlement was contested by the US Justice Department’s bankruptcy watchdog, whom he criticized during Tuesday’s hearing.

Representatives for families of the late Mortimer Sackler and Raymond Sackler have denied wrongdoing and said they’d support “a resolution that provides substantial resources to help combat a complex public health crisis.”

The case is Purdue Pharma LP, number 19-23649, in the US Bankruptcy Court for the Southern District of New York.

--With assistance from Jef Feeley.

More stories like this are available on bloomberg.com

©2024 Bloomberg L.P.

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First Published:10 Jul 2024, 02:53 AM IST
HomeNewsPurdue Pharma Wins Short Window to Negotiate New Sackler Deal

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