By Tom Hals and Dietrich Knauth
(Reuters) -A mediator will soon outline recommendations for ending Purdue Pharma's bankruptcy which is expected to provide billions of dollars to address the opioid crisis that the OxyContin maker has been accused of fueling, a company lawyer said on Thursday.
The Sackler family owners of Purdue and attorneys general from eight states and the District of Columbia have been negotiating in court-ordered mediation since early January.
The mediator will file a report with the court late on Thursday or early Friday, Purdue attorney Marshall Huebner told U.S. Bankruptcy Judge Robert Drain during Thursday's hearing in White Plains, New York.
U.S. Bankruptcy Judge Shelley Chapman, the mediator, said in court filings in recent weeks that the parties were close to an agreement and that the Sacklers would make a "substantial" additional contribution. She has twice asked Drain to extend the deadline for the mediation, which in the latest court order expired on Wednesday.
Drain granted a Purdue request to extend a legal shield through March 3 that prevents opioid lawsuits from going forward against members of the Sackler family.
The legal shield, which Purdue has said is needed while the parties try to work out a settlement, has been in place since 2019.
The nine attorneys general led the opposition to a previous $4.33 billion settlement that was rejected in December on appeal by a U.S. District judge in Manhattan. The attorneys general had argued that the Sacklers should contribute more in return for the legal releases they obtained through the bankruptcy plan.
Purdue filed for bankruptcy in 2019 in the face of thousands of lawsuits accusing it and Sackler family members of helping cause the U.S. opioid epidemic through deceptive marketing that played down addiction and overdose risks.
The company pleaded guilty to misbranding and fraud charges related to its marketing of OxyContin in 2007 and 2020. The Sacklers have denied wrongdoing.