The bankruptcy of Purdue Pharma L.P. has become one of the most closely watched Chapter 11 cases in U.S. history. It is also a powerful illustration of a reality that many creditors underestimate at the outset of a bankruptcy case: even after a plan is “confirmed,” payment can remain uncertain for years.

Purdue filed for Chapter 11 protection in September 2019, seeking to resolve thousands of claims related to the opioid crisis through a comprehensive restructuring and settlement framework. What followed was not a typical bankruptcy timeline.

In 2021, the bankruptcy court confirmed a Chapter 11 plan that would have resolved Purdue’s liabilities and provided for distributions to creditors through a newly created entity funded in part by contributions from the Sackler family. Many creditors reasonably believed that confirmation marked the beginning of the end of the case.

It did not.

The confirmed plan was appealed, and in 2023–2024, the case reached the U.S. Supreme Court, which ultimately overturned the confirmation order, sending the case back into further negotiations and litigation. As a result, years of work, documentation, and creditor expectations were effectively reset.

Only recently—nearly six years after the initial filing—has a revised plan again been confirmed, and even now, the plan has not yet gone effective, meaning creditors still have not received distributions. Appeals risk, implementation conditions, and regulatory steps remain part of the process.

For creditors who have held their claims throughout the case, the outcome may eventually be favorable—but the cost of time has been significant. Capital that was expected to be returned in the early 2020s remains tied up, with no ability to redeploy it elsewhere and no certainty as to final timing.

The Liquidity Trade-Off

The Purdue case underscores a broader lesson applicable well beyond mass-tort bankruptcies: bankruptcy cases can, and often do, last far longer than initially anticipated. Confirmation does not guarantee finality. Appeals, reversals, renegotiations, and delays can materially extend timelines, sometimes by years.

For many creditors, the question is not simply ultimate recovery—but when that recovery will arrive, and what alternative uses of capital may be foregone in the meantime.

At CRG Financial, we began purchasing Purdue Pharma bankruptcy claims as early as 2020. Creditors who chose to sell at that time received immediate liquidity and certainty, allowing them to put capital back to work rather than waiting through years of legal proceedings, appeals, and delays. Today, nearly five years later, those sellers have already realized the value of time—regardless of how the case ultimately concludes.

Key Takeaways

Purdue Pharma is an extreme example, but not an isolated one. Bankruptcy cases—particularly complex Chapter 11 proceedings—can stretch far beyond original expectations. For creditors, selling a claim is not about pessimism; it is often about risk management, liquidity, and control over timing.

In an environment where years can separate filing from payment, the ability to convert a bankruptcy claim into immediate cash can be a compelling alternative to waiting—sometimes indefinitely—for final resolution.