JP Morgan Chase, the banking giant which handles accounts for Oxycontin manufacturer, Perdue Pharma, has told them to take their business elsewhere.
JP Morgan did not lend money to Purdue, but JPMorgan’s commercial bank managed the company’s cash and bill payments, according to NBC. It’s currently unknown how long the bank handled finances for the pharmaceutical giant. The company is an enormous banker in the United States. According to inside sources, the banker has dropped Purdue Pharma due to its involvement in the opioid industry, and presumably because Purdue faces nearly 2,000 lawsuits in the United States.
Banks have always made it a practice to refuse to lend credit to companies with risky ties or lousy credit. Purdue’s ongoing litigation certainly made it easier for the bank to drop them. The company has even considered bankruptcy as a way to free up assets due to the continuing lawsuits.
Opioid Lawsuits Taking a Toll
Purdue recently settled a lawsuit in Oklahoma for a staggering 270 million dollars. The money will now go to fund addiction research and treatment in Oklahoma. In the lawsuit, filed two years ago, Oklahoma Attorney General Mike Hunter said that Purdue helped fuel the opioid crisis with aggressive marketing for their most addictive drug, OxyContin. This marketing included making false claims to doctors to drive more prescriptions, while they downplayed the dangers of addiction.
Purdue says that the bank’s moves don’t affect them.
“Purdue is a streamlined organization with an exciting pipeline of new medicines and significant cash reserves,” the company said in a statement to NBC News. “The company has multiple banking relationships and will not have any interruption to its banking and financial service needs.”
Across the United States, other jurisdictions wait their turn to have representatives from Purdue Pharma face the court. All in all, there are nearly 2000 lawsuits from cities, states, counties, and Indian reservations that are suing various players in the pharmaceutical industry. Many legal insiders compare the opioid trials to the tobacco lawsuits cigarette manufacturers faced in the 1990s.