Florida could get a share of a $7 billion bankruptcy plan filed late Monday by Purdue Pharma to dissolve the company and steer its assets toward abating the nation’s opioid epidemic.
Florida Attorney General Ashley Moody hailed the proposal, saying in a prepared statement Tuesday that it would secure additional funding “for Florida communities plagued by the national opioid crisis.” The company’s reorganization proposal, which has to be approved by a federal bankruptcy judge and a majority of the company’s creditors, requires members of the Sackler family to pay $4.275 billion to states, tribes and local governments.
Members of the family founded and have owned the company. How the money will be allocated has not been finalized, Lauren Cassedy, a spokeswoman for Moody, said in an email Tuesday.
If the plan is approved, Florida could get up to $280 million to $400 million over a 10-year period, according to Cassedy. "However, additional recoveries and insurance proceeds are expected, and it is our hope that the amount is exceeded for Florida’s share," Cassedy said.
Under the bankruptcy plan, the Sacklers also would have to sell their interests in Purdue, the maker of OxyContin, and other pharmaceutical businesses within seven years and would be permanently banned from engaging in the manufacturing or sale of opioid medications.
“Although we cannot reverse the damage that this epidemic has inflicted, these life-saving funds will now be available early next year, and strict measures are now in place going forward to prevent the insidious and harmful marketing of opioids,” Moody said.
Moody served on the 18-member Purdue Pharma Bankruptcy Ad Hoc Committee, which led discovery and negotiations on behalf of communities impacted by the opioid crisis, according to a news release.
Purdue “has delivered a historic plan that can have a profoundly positive impact on public health by directing critically needed resources to communities and individuals nationwide who have been affected by the opioid crisis,” Steve Miller, chairman of Purdue’s board of directors, said in a statement.
The restructuring plan would create a new, private company that would be run by states and local governments that sued Purdue. Funds from the company “will be used exclusively for abatement purposes and not diverted elsewhere,” Miller said.
The plan filed Monday is a $1.5 billion increase from a bankruptcy proposal in September 2019.
The Purdue bankruptcy proceeding is separate from an ongoing lawsuit filed by Florida seeking an unspecified amount of damages from pharmaceutical manufacturers, distributors and retailers to recoup money spent on opioid addiction and deaths. Hundreds of other lawsuits have been filed throughout the country.