Insys Therapeutics, the first drugmaker to go bankrupt after opioid litigation, won court approval for its bankruptcy plan Jan. 16, The Wall Street Journal reported.
Under the plan, Insys sold the rights to its flagship opioid drug, Subsys, a form of fentanyl. But the money it made from selling its assets wasn't enough to cover its debts, which total more than $1 billion.
The drugmaker plans to pay people with personal injury claims resulting from use of Insys drugs by using product liability insurance, but its creditors will only get about 8 cents on the dollar, or less, from the bankruptcy agreement, the Journal reported.
Under the plan, the U.S. Justice Department said it won't collect the $234 million Insys agreed to pay it until trade suppliers and those with damage claims receive at least 4 cents on the dollar of what they're owed.
Brenda Funk, Insys' bankruptcy lawyer, reportedly called the plan a "monumental success" because it allowed the company to shut down with minimal court fights, according to the Journal.
Insys' founder and CEO John Kapoor was convicted in May of paying kickbacks to drive Subsys sales and is scheduled to be sentenced Jan. 23.
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