Judge Freezes Assets of Meningitis Pharmacy Owners
The personal assets of the owners of the Massachusetts compounding pharmacy linked to the recent deadly meningitis outbreak were temporarily frozen by a bankruptcy judge in response to an emergency motion by a committee of the company’s creditors.
Reuters reports that the order means that the owners of the New England Compounding Center (NECC) are temporarily prohibited from selling their luxury homes or spending up to $21 million that they received last year in salary and shareholder distributions.
NECC faces numerous lawsuits by alleged victims of tainted steroid injections manufactured at the company’s Framingham facility. The contaminated steroids are linked to the meningitis outbreak that has killed 44 people and infected almost 700 others, according to figures from the Centers for Disease Control.
The company, which was forced to shut down last October in the wake of the meningitis outbreak, filed for bankruptcy at the end of 2012.
The bankruptcy judge's rulings came in response to an emergency motion of the Official Committee of Unsecured Creditors after an investigation by the group revealed that the payments to NECC’s owners were in excess of $16 million during the final months of 2012, according to Reuters. The Committee of Unsecured Creditors also includes the meningitis outbreak victims.