Drugmaker Insys Therapeutics Inc., whose former executives were convicted of bribing doctors to prescribe its highly addictive opioid, filed for bankruptcy protection after agreeing to pay hundreds of millions of dollars to settle a probe by U.S. prosecutors.
The Chapter 11 filing in Delaware Monday allows the company to keep operating while it devises a plan to pay its obligations, including to the Justice Department, and try to turn around the business to salvage a pipeline of cannabis-derived drugs.
Insys is the first drugmaker to be forced to seek protection from its creditors as a result of legal action related to the U.S. opioid epidemic. Several larger, more diversified drugmakers have been sued by state and local governments that say the companies used misleading marketing tactics to create a costly public-health crisis.
“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 Officer Andrew Long said in a statement.
Information, such as the company’s assets and liabilities, was blacked out from the bankruptcy filing.
The case is In RE Insys Therapeutics, No. 19-11292, U.S. Bankruptcy Court for the District of Delaware (Wilmington)
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