The maker of OxyContin, Purdue Pharma LP, my be exploring bankruptcy as an option to acknowledge the liabilities that stem from about 2,000 lawsuits against the company. These lawsuits allege that the drugmaker supported the opioid crisis in the U.S. The litigations accuse the company of misguiding patients and doctors about the long-term risks of using its prescription opioids.
If Purdue files for Chapter 11 bankruptcy protection, the lawsuits would cease, allowing for the company to negotiate legal claims under the direction of a United States bankruptcy judge. Purdue denies the alleged clams against them, disputing that its opioids came with an FDA-approved warning label concerning the risks associated with the pain medications.
The lawsuits accuse Purdue of using misleading practices in order to push drugs that are addictive. Some claims deal with fatal overdoses by opioid users. The complaints against the drug manufacturing company include contributing to overdoses resulting in death and flooding the market with opioids that are highly addictive.
The bankruptcy is not certain, and reports indicate that the company has not made any final decisions. Purdue could continue fighting the lawsuits and not file bankruptcy.
In 2017, prescription painkillers and opioids were involved in approximately 47,600 deaths due to overdose. According to U.S. Centers for Disease Control and Prevention data, that is six times an increase from 1999.
Bankruptcy doesn’t necessarily mean the drug company is in current debt or financial distress. Purdue has sought out legal advice for restructuring, and it is a possibility that they may also seek out bankruptcy protection before an upcoming trial. Bankruptcy could offer the legal protection the company needs to address liabilities as they face lawsuits.