Cantrell Drug Co. files for bankruptcy

Cantrell Drug Co., a Little Rock, Ark.-based specialty pharmaceutical organization, filed for Chapter 11 bankruptcy Tuesday.

James McCarley Jr., MD, the company's chairman and CEO, cited two recent inspections by the FDA as the reason for the bankruptcy. The two inspections, which took place in the last year, led Cantrell to temporarily suspend product manufacturing and shipping, according to a news release.

"Our deficiencies were regulatory in nature and not in response to any product problem or patient illness. Out of an abundance of caution, we ceased production two times in the last eight months," Dr. McCarley said.

"We're a privately owned, family business, and we just don't have the resources of a big publicly traded pharmaceutical company to weather the economic consequences of a shutdown; hence, the reorganization of our company. I'm paying for operations and payroll out of my own pocket at this point. My wife, Lynn, who co-owns the company with me, and our family is determined to get through all this."

Dr. McCarley added Cantrell has been making efforts to address the FDA's concerns and in the meantime — for the benefit of hospital customers — decided to outsource parts of its quality assurance and quality control department to third-party expert firm Escalate Sciences.

He went on to say he expects Cantrell to come out of bankruptcy "in a minimal amount of time."

"Above all I want to make it clear to everyone that our intent is to pay 100 cents on the dollar to all our creditors. We have no intention of any sort of liquidation, cram down or write off," Dr. McCarley said. "I've asked our vendors to work with us, to give us time to get back on our feet. So far, I've been very pleased with the understanding and support we've received from the trade."

As far as the company's expansion plans, he said Cantrell currently has a 20,000-square-foot facility but wants to expand into a second production facility after the company's bankruptcy reorganization.

 

 

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