New York (CNN Business)Purdue Pharma has filed a restructuring plan to dissolve itself and establish a new company dedicated to programs designed to combat the opioid crisis, according to court documents filed Monday.
As part of the proposed plan, the Sackler family has agreed to pay an additional $4.2 billion over the next nine years to resolve various civil claims. “The vast majority of the Debtors’ assets will be dedicated to programs to abate the opioid crisis. Billions of dollars will flow into trusts established for the benefit of states and localities, as well as other creditor groups such as Native American Tribes, hospitals, and children with a history of Neonatal Abstinence Syndrome and their guardians. Each trust will require that the funds be dedicated exclusively to opioid abatement efforts, and there will be transparency to so ensure,” court documents state.
The company, which makes OxyContin, called the plan “unprecedented in scope and nature” in a press release.
The restructuring plan is over 300 pages long. It details how the embattled pharmaceutical company plans to transfer billions of dollars and operating assets into a newly-formed company, whose stated mission is to address the country’s opioid crisis. Read More
McKinsey to pay nearly $600 million in settlements over its work with opioid companiesPurdue Pharma said in a press release that state and local governments will neither own, nor operate the new company and that more than $10 billion will be designated to “providing, at cost, millions of doses of potentially lifesaving opioid addiction treatment and overdose reversal medicines.”Purdue Pharma’s plan will also distribute funds through two newly-established national opioid abatement trusts: the National Opioid Abatement Trust (the “NOAT”) and the Tribe Trust, which will be dedicated to resolving claims from Native American tribes. “All value distributed to NOAT and the Tribe Trust will be exclusively dedicated to programs designed to abate the opioid crisis and for no other purpose (other than to fund administration of the programs themselves and to pay fees and costs). The Debtors believe that funding these dedicated abatement funds, while allocating significant value for distribution to holders of PI Claims, is in the best interest of creditors and of the American public,” court documents state.
A hearing to approve the plan is scheduled for April 21.The Sackler’s have already paid $225 million under an initial settlement framework to satisfy their civil settlement with the US Department of Justice and persons associated with the Sackler entities have agreed to be “prohibited from engaging in the manufacturing or sale of opioids, subject to exceptions to be agreed,” court documents state.
Source: edition.cnn.com