Opioid-Maker Insys Files For Bankruptcy Just Days After Agreeing To Pay $225M To Settle Fraud Charges
In the bankruptcy court filing, Insys Chief Executive Andrew Long said sales of Subsys, a fentanyl spray, have declined substantially. That drop, coupled with more than 1,000 lawsuits by municipal governments seeking to hold the company responsible for the opioid epidemic, was more than the company could withstand.
The New York Times:
Insys, The Opioid Drug Maker, Files For Bankruptcy
The opioid manufacturer Insys Therapeutics filed for bankruptcy protection Monday, days after agreeing to pay $225 million to settle a federal investigation into the marketing practices for its powerful fentanyl painkiller. The company said it would continue operating while it comes up with a plan to pay its creditors, including the Justice Department, under Chapter 11 of the federal bankruptcy code. Under an agreement released last week with the federal government, the company has promised to divest of Subsys, its lead product and the painkiller that had come under scrutiny. (Thomas, 6/10)
Reuters:
Opioid Manufacturer Insys Files For Bankruptcy After Kickback Probe
The bankruptcy filing came after a federal jury in Boston in May found Insys founder John Kapoor and four other former executives guilty of engaging in a racketeering conspiracy centered on its fentanyl spray, Subsys. Chandler, Arizona-based Insys said it filed for bankruptcy in U.S. Bankruptcy Court in the District of Delaware to facilitate a sale of its assets, including Subsys. Insys listed $175.1 million in assets and $262.5 million in debt as of March 31. Shares of Insys fell 66% to 44 cents in premarket trading. (Raymond, 6/10)
Stat:
Insys, Opioid Maker Implicated In Kickback Scheme, Files For Bankruptcy
“After conducting a thorough review of available strategic alternatives, we determined that a court-supervised sale process is the best course of action to maximize the value of our assets and address our legacy legal challenges in a fair and transparent manner,” Insys chief executive Andrew Long said in a statement. For the time being, the drug maker plans to use existing cash on hand and operating cash flows to support operations, including paying employees. Recently, Insys has kept busy developing cannabinoid products. (Silverman, 6/10)
