A New York bankruptcy judge has approved the Purdue $7.4B Chapter 11 Plan, clearing a path Friday for billions of dollars to begin flowing to communities and victims devastated by the opioid epidemic—an epidemic fueled for years by Purdue Pharma’s marketing of OxyContin.
U.S. Bankruptcy Judge Sean H. Lane closed out the third and final day of the confirmation trial by announcing he would confirm the sweeping plan, promising a detailed bench ruling next Tuesday that explains the reasoning behind the decision.
Billions Headed to Victims as Sackler Deal Anchors Plan
$6.5B Sackler Settlement at the Center of the Deal
At the heart of the plan is a $6.5 billion settlement with the Sackler family, Purdue’s billionaire owners who did not file for bankruptcy but agreed to fund massive trusts for public and private claimants.
Creditors will choose whether to grant releases shielding the Sacklers from future lawsuits. Those who opt in tap into the full recovery pool; those who refuse retain the right to sue individually—but will have access only to a more limited Purdue-based pot of funds.
Purdue, which filed for Chapter 11 in September 2019, has said it faces an almost unfathomable $41 trillion in liability linked to its opioid products. The company will also contribute roughly $900 million in free cash to the settlement trusts.
