St. Louis based KV Pharmaceutical files for Chapter 11 bankruptcy protection after dealing with manufacturing issues along with weak sales of its birth control drug Makena. The company claims they plan to continue operations and sought bankruptcy protection to restructure their debt. The company has been accused in taking part of a scandal that lead to consumers being charged high prices for their birth control products.
KV has seen its share of struggles and troubles before their bankruptcy filing. Certain health officials claim their prenatal drugs are oversized. The company had past issues that involved banishment of their former chairman, criminal prosecution and no inclusion with federal health programs. The Food & Drug Administration (FDA) declined KV’s rights to sell Makena when they were being offered at $1,500 per injection while reducing premature birth risk.
Legal representatives for KV filed the company’s petition in Manhattan, New York. The petition states the company has close to $730 million in liabilities with about $240 million in assets. The filing took place when the company was unable to make a payment of $95 million to a Massachusetts based firm Hologic Inc. The firm helped the drug maker develop Makena, yet KV didn’t patent or invent the drug. Holohic claims they were in an agreement with KV to be paid $200 million for the rights to sell and market the drug.
Many recall the outcry and controversy over Makena being available at an outrageous price with top medical organizations and 2 United States Senators objecting to the costs. Generic drugs available at affordable prices have hurt KV sales. Due to manufacturing issues, the company had agreed to pay $27.6 million toward a government settlement. The company in recent years closed or sold certain divisions of their drug business.