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OxyContin drugmaker Purdue Pharma exploring bankruptcy, sources say

Published on 04/03/19 at 03:55pm

OxyContin drugmaker Purdue Pharma is exploring the option of filing for bankruptcy. The news comes as the Connecticut-based firm faces thousands of lawsuits over allegations the company’s actions contributed to the opioid crisis in the United States.

Speaking to news agency Reuters, people familiar with the matter have said that Purdue are exploring bankruptcy as a means of deflecting more than 1,000 lawsuits related to the company’s role in the opioid epidemic.

Filing for Chapter 11 protection would halt any lawsuits and would allow the firm to negotiate claims with plaintiffs under the supervision of a US bankruptcy judge, the sources are reported to have said.

Purdue may however continue to fight the claims, having not made any final decision yet.

The lawsuits come after Purdue were alleged to have flooded the market with highly addictive opioids, while knowingly making false claims that the drugs were safe.

In August 2018, the opioid drugmaker was reported to have used the services of law firm Davis Polk & Wardwell LLP for restructuring advice. The move fuelled anxieties among litigants that the firm would file for bankruptcy before the trial began.

“As a privately-held company, it has been Purdue Pharma’s longstanding policy not to comment on our financial or legal strategy,” Purdue said in a statement.

“We are, however, committed to ensuring that our business remains strong and sustainable. We have ample liquidity and remain committed to meeting our obligations to the patients who benefit from our medicines, our suppliers and other business partners.”

Louis Goss

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