Purdue Pharma's Stamford headquarters

Connecticut and about 20 other states are rejecting Purdue Pharma’s offer to settle lawsuits about the drug company’s role in the nation’s opioid crisis, but cities and towns in the state may still prefer to accept the deal, a leading lawyer for the plaintiffs said.

In addition to the state, dozens of Connecticut towns, including Bridgeport, Waterbury and Fairfield, have sued Purdue Pharma and could be part of a massive settlement agreement that is now in the hands of a bankruptcy court in New York.

Paul J. Hanly, one of the attorneys representing plaintiffs in the case (including about 20 cities and towns in Connecticut,) said his clients “won’t have to” accept the proposed settlement “but most of them will.”

“None of the cities and counties have yet been asked to accept anything,” Hanly said. “Discussions with Purdue and the Sacklers continue.” The Sackler family, among the nation’s wealthiest,  owns the company.

A proliferation of lawsuits across the nation have accused the company of using aggressive and misleading sales tactics to push physicians to prescribe millions of doses of its dangerously addictive pills. But Stamford-based Purdue’s bankruptcy filing late Sunday has stayed all lawsuits against the company and provided a framework to settle those suits.

“There are no more lawsuits against Purdue possible,” Hanly said.

Still, Connecticut, New York, Massachusetts,  New Jersey, Pennsylvania, California, Illinois, Virginia, Delaware, North Carolina and about 10 other states aim to fight the proposed settlement in  bankruptcy court in New York.

And states like Connecticut may be able to continue their lawsuits against Sackler family members in state courts.

“Our office is prepared to oppose any request to the court to stay our litigation against the Sacklers,” said Connecticut Attorney General William Tong.

Connecticut and the other states rejecting the settlement say its proposed payouts won’t be enough to fund needed opioid mitigation efforts, and the total payouts will fall far short of the $12 billion being offered. The states rejecting the deal also say the proposed settlement’s cost to the Sackler family is small compared to the enormous wealth drug sales have given them — nearly $14 billion according to Forbes.

The maker of the painkiller OxyContin said in a statement that the bankruptcy filing is the next step in implementing an agreement to pay billions of dollars to the states and local governments.

Purdue proposed turning itself into a trust that would continue to produce OxyContin,  as well as overdose “rescue’’ drugs that would be distributed at no cost to communities across the country. Purdue assets and the continued sale of Oxycontin and other drugs were valued at about $10 billion by the company.

The Sacker family has also offered to contribute “a minimum of $3 billion, with the potential for substantial further monetary contributions from the sales of their [Mundipharma ] pharmaceutical businesses,” the company said. Mundipharma, based in Great Britain, sells Purdue Pharma’s drugs globally outside the United States.

“This settlement framework avoids wasting hundreds of millions of dollars and years on protracted litigation, and instead will provide billions of dollars and critical resources to communities across the country trying to cope with the opioid crisis,” said Steve Miller, chairman of Purdue’s board. “We will continue to work with state attorneys general and other plaintiff representatives to finalize and implement this agreement as quickly as possible.”

The Sackler family Sunday night issued a statement calling the settlement and bankruptcy a “historic step’’ to address a “tragic public health situation.’’

Twenty-seven states say they are in favor of the settlement. But Connecticut and some of the other states who are rejecting the offer say the numbers are inflated and highly speculative, based on optimistic calculations that may take years to realize.

Connecticut and other states were attempting through their lawsuits to “claw back” some of the money they say the Sacklers  have diverted from the company into offshore accounts over the years. They say that money should be made available to the plaintiffs.

“Purdue and the Sacklers cannot cry poverty while stashing billions overseas,” Tong said. “We will move aggressively in bankruptcy to disclose their hidden fortune and ensure their full wealth is now on the table.”

The federal bankruptcy court judge must decide whether the objections Connecticut and other opposing  states are sufficient to scuttle the deal or whether the objecting states will have to be bound by the settlement as well. The judge will also address another key issue: how the money from the settlement is to be distributed to thousands of plaintiffs.

Meanwhile, Hanly said Connecticut’s cities and towns that have sued Purdue will eventually also weigh in.

“If and when a proposed deal is set forth, the plaintiffs’ executive committee will present it to all of the cities and counties for their vote in the bankruptcy reorganization proceedings,” he said.

Avatar photo

Ana has written about politics and policy in Washington, D.C.. for Gannett, Thompson Reuters and UPI. She was a special correspondent for the Miami Herald, and a regular contributor to The New York TImes, Advertising Age and several other publications. She has also worked in broadcast journalism, for CNN and several local NPR stations. She is a graduate of the University of Maryland School of Journalism.

Leave a comment