The company, owned by the Sackler family, manufactured the opioid-based drug OxyContin – marketed as a narcotic painkiller and which has been blamed for a sharp rise in addiction, prescription drug abuse and fatal overdoses.
The company has denied any wrongdoing.
The bankruptcy is part of a framework designed to settle the legal claims and provide further funding to fight opioid addiction in the US.
“This court-supervised process is intended to, among other things, facilitate an orderly and equitable resolution of all claims against Purdue, while preserving the value of Purdue’s assets for the benefit of those impacted by the opioid crisis,” the pharmaceutical firm said in a statement.
According to Reuters, the Sackler family said: “It is our hope the bankruptcy reorganisation process that is now under way will end our ownership of Purdue and ensure its assets are dedicated for the public benefit.”
The majority of the lawsuits come from state and county governments, and while many have agreed to the terms of Purdue’s tentative settlement, others have rejected it and have said they intend to pursue members of the Sackler family through court.
“My office is prepared to hold the Sacklers accountable, regardless of whether or not Purdue declares bankruptcy,” Illinois Attorney General Kwame Raoul said in a statement last week.
The terms of the bankruptcy are reportedly worth $10bn (£8bn) and could rise to $12bn over time, including at least $3bn from the Sackler family.
The deal also calls for handing the company over to trustees and giving future profits from OxyContin and drugs in development to creditors.
The Sackler family was listed by Forbes magazine as one of the 20 wealthiest in the US in 2016. In a court filing last week, the New York attorney general’s office contended the family had transferred $1bn to itself through a Swiss and other hidden bank accounts, AP reports.
Lawyers representing some areas have said Purdue’s tentative settlement didn’t hold the Sacklers or the company sufficiently accountable for their roles in causing an opioid crisis that has killed more than 400,000 Americans in the last two decades.
Additional reporting by agencies