The group representing individuals and government entities with opioid-related claims against Mallinckrodt Plc say the pharmaceutical company needs to provide more information and time for them to determine whether they will vote in support of its proposed restructuring plan, Reuters reported. A virtual hearing on the matter is scheduled for Wednesday before U.S. Bankruptcy Judge John Dorsey in Wilmington, Del. The official committee of opioid claimants on Friday filed objections to Mallinckrodt’s disclosure materials and motion to begin soliciting plan votes. Mallinckrodt filed for bankruptcy in October with $5.3 billion in funded debt to resolve widespread litigation brought by states, local governments and private individuals accusing it of deceptively marketing opioids. The company is now pursuing a reorganization plan that would set up a $1.6 billion trust to resolve opioid-related claims. The plan would put unsecured noteholders in control of the company and eliminate $1.3 billion in debt. General unsecured creditors would split $150 million in cash. In court papers filed on Friday, the committee took issue with the provisions of the plan that would restrict opioid claimants’ ability to bring future claims against certain parties, including current and former officers and directors of the company. At the same time, the committee said, the disclosure materials don’t adequately explain opioid claimants’ recoveries. The committee argued that they need more details beyond the $1.6 billion figure attached to the trust. Additionally, the committee contends that claimants are not being given enough time or adequate notice of their rights. The U.S. departments of Health & Human Services and Veterans Affairs also filed an objection to the disclosure materials, saying that Mallinckrodt needs to explain how the opioid trust funds will be allocated. Mallinckrodt’s unsecured creditors’ committee and the U.S. Department of Justice’s bankruptcy watchdog, among others, have filed objections as well. The unsecured creditors' committee and trustee demanded more information about estimated creditor recoveries and challenged the plan's proposed releases for officers and directors.
