Framingham Compounding Pharmacy Files For Bankruptcy
Framingham-based New England Compounding Center (NECC), which has been linked to a fungal meningitis outbreak that has killed 39 people and sickened more than 600, filed for Chapter 11 bankruptcy protection, it announced.
In a statement issued Friday evening, the compounding pharmacy said it will seek to establish a fund to compensate individuals and families affected by the outbreak.
"We want to assemble a substantial fund, and then distribute it fairly and efficiently to those who are entitled to relief," said Keith D. Lowey, who has been appointed as NECC's chief restructuring officer.
There are many who feel they are entitled to relief. The bankruptcy court filing lists approximately 400 people with pending personal injury suits.
Attorney Daniel Cohn, NECC's bankruptcy counsel, said he expects a committee of meningitis claimants will be appointed to represent the entire group.
NECC estimated that it has between $1 million and $10 million in assets and the same in liabilities, though unresolved tort claims are not included in that estimate. NECC's top 20 unsecured creditors are owed a total of $310,708, according to bankruptcy court records. Among them is Polyfoam Corp. of Northbridge, which is owed nearly $18,000.
"Many families across the U.S. have been impacted by this great tragedy, and it is difficult to comprehend the sense of loss so many people have experience," Lowey said. "Everyone associated with the New England Compounding Center shares that sense of loss."
The bankruptcy filing sheds some light on NECC ownership. Barry J. Cadden, who in November traveled to Washington, D.C. to testify before a Congressional committee – where he invoked his Fifth Amendment right – has a 17.5-percent minority share in NECC, records show. His wife, Lisa M. Conigliaro-Cadden has an equal share.
Carla Conigliaro is the majority owner with 55 percent. She is married to a brother of Gregory A. Conigliaro, who has the remaining 10-percent stake.
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