The major pharmaceutical maker Insys Therapeutics filed for bankruptcy protection on Monday, less than a week after the company agreed to pay $225 million to settle federal charges related to bribing doctors to prescribe opioid painkillers.
The company filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court in the District of Delaware and said it will sell “substantially all” of its assets.
“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,” Andrew G. Long, Insys’ chief executive officer, said in a statement.
In May, multiple company executives, including founder John Kapoor and former national director of sales Richard Simon, were found guilty of paying off doctors to prescribe their fentanyl-based drug and of other racketeering practices.
The ruling from the federal jury in Boston was a major development and signaled that the government and the American people are increasingly willing to hold paharamecutial companies responsible for the nation’s opioid epidemic — which killed 47,600 people in 2017, according to government figures. The Centers for Disease Control and Prevention also estimates that the total "economic burden," which includes healthcare costs, lost productivity, and criminal justice costs, of opioid addiction in the U.S. is $78.5 billion annually.
In the $225 million settlement with the U.S. Department of Justice, the indicted Insys heads also agreed to the guilty verdict.
Insys ($INSY) said it hopes to complete the sale of its assets within 90 days and “address creditors’ claims as efficiently and expeditiously as possible.”
“We believe this process will provide us with a forum to negotiate an equitable resolution with our creditors and represents the best opportunity for our people and our business,” Long’s statement added.