Purdue Pharma LP is evaluating bankruptcy proceedings to manage liabilities from over 2,000 lawsuits alleging its role in the U.S. opioid crisis, according to sources. The company, which produces OxyContin, faces claims that it contributed to widespread addiction through marketing practices that downplayed risks, with plaintiffs drawing parallels to the 1998 tobacco industry settlement.
The potential bankruptcy filing would pause litigation and enable Purdue to negotiate settlements under court oversight. Over 1,600 lawsuits, including Oklahoma’s case, allege the company misled medical professionals and patients about opioid risks. A May trial in Oklahoma’s lawsuit remains pending, while more than 300 cases are active in state courts.
Purdue denies wrongdoing, stating its opioid labels included warnings about abuse risks. The company has not confirmed bankruptcy plans, with sources noting the move is not finalized. A spokesperson emphasized Purdue’s commitment to financial stability and obligations to patients and partners.
In 2007, Purdue and three executives pleaded guilty to federal charges over OxyContin’s misbranding, paying $634.5 million in penalties. The company’s 2017 OxyContin sales dropped to $1.74 billion from $2.6 billion in 2012, reflecting declining demand amid stricter prescribing rules. Opioid-related overdose deaths rose sixfold between 1999 and 2017, according to CDC data.
The Sackler family, Purdue’s owners, faces lawsuits alleging they profited $4.2 billion from opioid sales. Some states have sued the family directly, while the Sacklers explore creating a nonprofit to address addiction. A recent Oklahoma court filing dismissed Purdue’s claims of baseless allegations.
Settlement talks have not yet produced agreements. Purdue’s CEO, Craig Landau, has shifted the company’s focus toward non-opioid treatments, cutting jobs and rebranding under new leadership. The company hired Davis Polk & Wardwell LLP for restructuring advice, raising concerns among litigants.
