Months after the Supreme Court blocked previous contracts, Purdue Pharma filed a new bankruptcy plan as part of a $7.4 billion settlement to resolve thousands of cases against the company's allegations during the opioid crisis.
The bankruptcy company announced Tuesday that it had submitted a plan to reorganize Chapter 11 with the U.S. Bankruptcy Court in the Southern District of New York.
Last June, the Supreme Court blocked the settlement agreement, finding that the Sacklers, who previously controlled Purdue Pharma, could not be released from liability under federal law, despite donating $6 billion to the settlement.
“Following the 2024 Supreme Court decision, we have doubled our commitment to working with creditors to design a new plan that will provide unprecedented value to those affected by the opioid crisis. Today's submission is a major milestone in that effort.”
“We and our creditors worked tirelessly in mediation, building consensus, increasing the total amount provided to victims and the community, working billions of dollars on the first day, and negotiating settlements that would serve public goods,” Miller added. “We are truly grateful for the dedication and collaboration of our stakeholders. We look forward to the planning being completed as quickly as possible.”
In January, Purdue Pharma and Sackler agreed, in principle, to pay a $7.4 billion settlement to settle a large number of cases, increasing the settlement by an additional $1.4 billion. Tuesday's court filing expands on the plan.
Purdue Pharma argued that the reorganization is likely to be successful, saying, “The reorganization of debtors is clearly in the public interest and is supported by balancing harm. The proposed debtors' plans would devote billions of dollars to reducing public opioids and recovering creditors.”
