Another culpable opioid company attempts bankruptcy angle to avoid opioid payouts to victims and their families.
An Irish drug manufacturer Mallinckrodt is currently in talks to negotiate down a portion of the companies $1.7B obligation as part of a bankruptcy proceeding. The dealings have the potential to cut a billion dollars of the companies payout to victims of the opioid epidemic. News of the attempt was originally published in the Wall Street Journal.
According to NPR‘s addiction correspondent, that article reported a group of hedge funds intent to pursue a new bankruptcy plan that would effectively leave the funds in control of the firm. If the deal receives court approval it has the potential to block pending opioid lawsuits faced by Mallinckrodt. This comes at a time when the Department of Justice is currently appealing a previous bankruptcy dealing up to the Supreme Court. This was a 2021 bankruptcy dealing for Purdue Pharma which allowed the Sackler Family to save billions and establish immunity from any further opioid lawsuits. There is not word yet as to whether the Supreme Court will hear the case but if they do, it could have implications for similar bankruptcy negotiations with culpable entities.