WASHINGTON – The Justice Department decided Thursday to block a bankruptcy plan that grants broad legal immunity to pharmaceutical company Purdue Pharma, whose drug OxyContin has been at the heart of the country’s opioid epidemic.
William K. Harrington, the US administrator for the Department of Justice, has filed a petition in federal court to stay confirmation of the settlement while the department is appealing the judge’s decision to approve the deal.
Mr Harrington said the court should grant his stay request because the federal government “has a substantial possibility of success on appeal and because the harm that would result from denying a stay outweighs any potential harm. to grant one ”.
The contentious deal was approved this month by Judge Robert Drain, a federal judge from White Plains, NY. Among other things, he could release the Sackler family, owners of Purdue Pharma, from any future legal liability in exchange for a financial contribution of $ 4.3 billion from the family’s own fortune.
Mr Harrington argued in his case that the agreement removed the rights of those who had a valid legal claim against the Sacklers “without their informed consent, adequate notice or the opportunity to be heard.”
He also said the federal government’s case was supported by previous Supreme Court rulings.
The Justice Department case is the latest in a long battle to hold the Sackler family accountable for creating, marketing and selling OxyContin, a highly addictive pain reliever.
Some experts have argued that OxyContin has helped fuel an epidemic of opioid addiction that has killed more than 500,000 people nationwide and is still raging in the United States 25 years after the drug was introduced to the market. .
But OxyContin has made the Sackler family incredibly wealthy. From 2008 to 2017, the family withdrew $ 10.4 billion from Purdue Pharma.
As more people died from opioids, plaintiffs began suing Purdue. By the time the company filed for bankruptcy in September 2019, it was facing 2,900 lawsuits, including more than 600 against the Sacklers. The bankruptcy proceedings put an end to these legal claims.
Justice Drain approved the settlement plan after painstaking negotiations between family, local governments, hospital systems and others who had sued the company and were likely to be involved in costly litigation for years to come. .
Those who supported the deal, including a majority of states and some of the plaintiffs, argued that it would provide much needed funding for drug treatment programs.
Steve Miller, chairman of the board of directors of Purdue, said the settlement “ensures billions of dollars will be spent helping the people and communities that have been affected by the opioid crisis.” And some members of the Sackler family have called the resolution an important step in the fight against the public health crisis.
But critics said the conditions unfairly protected the Sacklers. It afforded family protections typically given to businesses that have filed for bankruptcy, but not to business owners if they haven’t declared bankruptcy themselves.
The Justice Department and some states appealed Judge Drain’s ruling.