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Attorneys general who had been critical of a proposed bankruptcy plan for the OxyContin manufacturer said they would agree to a deal that requires significant public disclosure from the company.
Fifteen state attorneys general have dropped their opposition to a bankruptcy plan for OxyContin manufacturer Purdue Pharma that will require the Sackler family owners to payout roughly $4.5 billion. They include attorneys general from Massachusetts and New York, who were among the most ardent critics of the original bankruptcy settlement plan.
Now just nine states and the District of Columbia remain in opposition to the proposal, raising the odds that a bankruptcy court will approve the plan.
Those who backed the agreement Thursday said they did so because it requires Purdue Pharma to make significant public disclosures and it will help speed up the proceedings to get much needed money into communities ravaged by the opioid epidemic.
“While this plan is far from perfect, allowing it to move forward now is the best way to ensure that billions of dollars in desperately-needed funding flows to the communities in North Carolina and across the country,” said North Carolina Attorney General Josh Stein in a statement.
The revised agreement was disclosed in a court filing made late Wednesday night by a mediator in U.S. Bankruptcy Court in White Plains, New York. In addition to requiring the Sackler family to pay an extra $50 million, the agreement requires Purdue Pharma to publicly disclose millions of pages of evidence and documents.
“Is it enough? No. But this case is not about the money,” said Massachusetts Attorney General Maura Healey as she spoke to reporters Thursday. “The public will bear witness to the most significant disclosure in any case ever, including every piece of evidence Purdue produced about its opioid business in the last 20 years.”
The documents will include evidence from lawsuits and investigations of Purdue Pharma, including deposition transcripts and videos.
“This public disclosure means no one will ever forget what they did to us and no one can ever do it again,” said Minnesota Attorney General Keith Ellison in a statement explaining elements of the plan.
State attorneys general originally claimed that Purdue owed states more than $2 trillion to address the company’s role in the opioid epidemic.
Purdue Pharma sought bankruptcy protection in 2019 to shield it from more than 3,000 lawsuits brought by state and local governments and other entities. Lawsuits brought against the company say its marketing and distribution of prescription drugs fueled the opioid crisis, which resulted in nearly 500,000 deaths over 20 years.
As a result of other litigation, the Sacklers are barred from participating in the opioid business. The bankruptcy agreement would also forbid them from seeking naming rights to places like hospitals and museums.
Attorneys general who remain opposed to the plan said it allows the Sacklers to walk away with their wealth intact.
“Purdue and the Sacklers have misused this bankruptcy to protect their vast wealth and evade consequences for their callous misconduct,” said Connecticut Attorney General William Tong in a statement.
Washington Attorney General Bob Ferguson said the Sackler family should be required to pay back the $11 billion they earned through Purdue Pharma’s prescription opioid sales.
The bankruptcy court is set to hold an Aug. 9 hearing on the case. At that time the court will consider any objections to the plan and could rule to either accept or reject the agreement. States that objected to the agreement are still entitled to receive settlement payments.
Several attorney generals said the case highlights the need to reform the federal bankruptcy system.
“The way the current bankruptcy system works right now allows billionaires to work to find ways to protect themselves,” Healey said. “But we can change that.”
Andrea Noble is a staff correspondent with Route Fifty.