The privately-held pharmaceutical company, Purdue Pharma, is reportedly considering filing for bankruptcy to settle thousands of legal claims against it. The company, which produces the popular opioid medication OxyContin, is currently facing more than 2,000 lawsuits across the United States. Along with other drug manufacturers, Purdue is being blamed to have contributed to the deadly opioid crisis that is sweeping the country.
According to experts, filing a Chapter 11 protection claim would allow the company to negotiate the different legal claims against it under the supervision of a bankruptcy judge. A potential strategy is a valid option for the company's wealthy owners, the Sackler family, to alleviate the pressures caused by the mounting litigations against their firm. Majority of the litigations, with more than 1,600 of them in Ohio, alleges that the company deliberately misled doctors and patients about the risks associated with their products.
In response to the claims, Purdue has outright denied all allegations against it. The company argues that the Food and Drug Administration (FDA) had approved all of its products and all of the necessary warning labels are present in its packaging. The labels apparently clearly state the risks involved with prolonged use, abuse, and misuse of its prescription opioids.
According to the United States Center for Disease Control and Prevention (CDC), abuse of opioids such as OxyContin and Fentanyl have so caused more than 47,600 deaths due to overdose in 2017 alone. The number has exponentially risen over the past few years due to the increase in availability of the drugs on the streets.
Despite the lingering rumors of the company filing for bankruptcy, Purdue has insisted that it is still willing to aggressively face all of the claims against it. Purdue recently mentioned in a statement that they are still liquid enough to meet all of their legal obligations and that their business still remains strong and sustainable.
The company is currently scheduled to face a trial in May, which was brought forward by Oklahoma's attorney general. Similar to other claims, the trial will try to determine whether or not the company had actually contributed to the flooding of opioids in the market that resulted in hundreds of fatal overdoses. The lawsuit also alleges that Purdue may have made false claims regarding its product's safety.
Since the addictive and potentially dangerous effects of their products have been made public, sales of OxyContin have fallen. The company reportedly earned only US$1.74 billion in OxyContin sales in 2017, which was a drastic drop from the US$2.6 billion it earned in 2016. Purdue has had to settle a number of lawsuits over the years, including a US$634.5 million settlement involving a federal case against its top executives.
