© Reuters. FILE PHOTO: Bottles of OxyContin prescription pain pills, made by Purdue Pharma LP, sit on a counter at a local pharmacy in Provo, Utah, U.S. April 25, 2017. REUTERS/George Frey
By Dietrich Knauth
NEW YORK (Reuters) – Bankrupt Purdue Pharma received approval from a U.S. judge on Tuesday to sell its consumer healthcare business for $397 million to a subsidiary of Arcadia Consumer Healthcare.
U.S. Bankruptcy Judge Sean Lane approved the sale of Avrio Health by Purdue during a hearing in White Plains, New York, allowing Purdue to begin liquidating its assets pending a final decision on a 10-year settlement. billion dollars that would dedicate the company’s remaining resources to the fight against the United States. opioid epidemic.
Purdue’s committee of creditors pushed the company to use the proceeds from the sale to kick-start that effort by compensating victims of the opioid crisis and funding addiction treatment programs.
Purdue attorney Eli Vonnegut said in Tuesday’s hearing that the company supports that goal, but will first need to reach consensus among the various stakeholders in its bankruptcy. Purdue is reluctant to take this step as its future is uncertain and its bankruptcy plan is tied to appeals, Vonnegut said.
Purdue filed for bankruptcy in 2019 to resolve thousands of lawsuits alleging its opioid painkiller OxyContin sparked an epidemic that caused more than 500,000 overdose deaths in the United States over two decades.
Purdue’s efforts to settle bankruptcy lawsuits have been stalled by appeals challenging the company’s efforts to shield its owners, members of the wealthy Sackler family, from liability in exchange for a $6 billion contribution to the Purdue settlement.
While Purdue has resolved most objections to its plan, the US Justice Department’s bankruptcy watchdog has continued to argue that the Sacklers cannot be protected by the bankruptcy settlement because they are not them. themselves bankrupt.
The 2nd U.S. Circuit Court of Appeals, which heard arguments in April 2022, has yet to rule on the appeal.
Avrio Health has never been involved in Purdue’s opioid business. He sells over-the-counter antiseptics and laxatives, according to court documents.
Purdue originally planned to sell the company as part of its post-bankruptcy transition into a nonprofit dedicated to fighting opioid overdoses and opioid use disorders.