K-V Pharmaceutical Co. (KV-A, KV-B) and certain of its domestic units filed voluntary Chapter 11 petitions under the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York, seeking the protection of Chapter 11 while it seeks to restructure its financial obligations.
The company would continue to operate during the reorganization paying employees and vendors in the normal course of business for goods and services provided postfiling, and providing its women's health care products without interruption to meet the needs of the healthcare providers and patients it serves.
President and Chief Executive of K-V Pharmaceutical noted, "The Company has been unable to realize the full value of its most important product, Makena (hydroxyprogesterone caproate injection), because of a lack of enforcement of the orphan drug marketing exclusivity granted to K-V for Makena® by the Food and Drug Administration (FDA). The lack of enforcement has also led certain state Medicaid agencies to impose barriers to access to Makena® on low-income pregnant women at high risk for recurrent preterm birth, despite those states' legal obligation to cover FDA-approved drugs."
The Chapter 11 filing is intended to provide K-V with the time needed to continue to conduct its business and restructure its financial obligations as it continues to ensure that all clinically-indicated patients have access to Makena.
The company, in its filing papers, reported that restrictions on reimbursement imposed by a number of State Medicaid agencies, and significant restrictions on manufacturing and marketing of other K-V products imposed by a previous FDA Consent Decree agreed to by the company in March 2009 have also had a major negative impact on its revenues and ability to meet short and long-term obligations, that includes a milestone payment under the terms of the company's deal with Hologic Inc. under which the company bought all rights to Makena.
K-V was unsuccessful prior to the filing in obtaining a renegotiation of the milestone payments owed to Hologic on terms that were acceptable to the company. Consequently, the company was forced to file these Chapter 11 cases.
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by RTT Staff Writer
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