California, New York and other states are revolting against the Justice Department’s proposed settlement with OxyContin maker Purdue Pharma LP, which is accused of helping fuel the opioid crisis, WSJ Pro reported. The proposed pact comes up for approval next week in bankruptcy court, where Purdue sought refuge from litigation. But a growing chorus of critics is warning the proposal would short-circuit broader talks about how to use Purdue’s assets to address the addiction epidemic. Purdue is set to plead guilty to three felony counts including conspiracy to defraud the U.S. and conspiracy to violate federal anti-kickback laws, as part of the settlement. The pact also calls for Purdue to transform itself into a company to be run for the benefit of the public. States said that the settlement, if approved, ties the hands of other creditors that would prefer to sell Purdue. Purdue was hit with an avalanche of lawsuits accusing it of pushing a highly addictive drug into vulnerable and unwary markets. It has denied wrongdoing and filed for chapter 11 last year to get breathing space and open talks about how to address demands for damages. Some Democratic lawmakers have also warned Purdue’s proposed deal with the Justice Department is bad for the public, but this week bankruptcy experts, dozens of states and lawyers for individuals with addiction-related claims against Purdue weighed in against it. Critics are urging delay so the deal doesn’t crowd out other alternatives for state and tribal governments and others that have been contending with the legal, social and medical burden of opioid addiction. The Justice Department negotiated separately from the general bankruptcy talks, critics said.
