Friday, May 8, 2015

NECC Liquidation Plan Gets Overwhelming Approval

By Walter F. Roche Jr.

The liquidation plan for the New England Compounding Center has won overwhelming approval from the victims of a 2012 fungal meningitis outbreak. Two other categories of claimants also approved the plan, albeit by smaller margins.
According to a report filed Friday with the U.S. Bankruptcy Court in Massachusetts, 2,591 or 99.04 percent of the outbreak victims or their survivors voted in favor of the plan filed by NECC bankruptcy trustee Paul D. Moore.
Victims voting to reject the plan totaled 25 or less than one percent.
Those with general unsecured claims against NECC voted 23-1 in favor of the plan while those with subordinated claims voted 26-7 for the plan.
The votes had to be submitted by 4 p.m. Tuesday in order to be counted.
The vote tabulation marks the completion of one more needed step before victims and creditors of NECC can get compensation for the 2012 fungal meningitis outbreak which took the lives of 76 people.
The bankruptcy plan will next be the subject of a May 19 hearing before U.S. Bankruptcy Judge Henry J. Boroff.
Fungus tainted vials of methylprednisolone acetate were shipped by NECC to physicians and healthcare facilities across the country in 2012. A total of 778 patients were sickened with many suffering fungal meningitis.
Particularly hard hit were states like Tennessee, New Jersey Virginia, Indiana and Michigan.
Under the plan some $220 million will go to victims and creditors. That includes nearly $50 million from NECC's owners. Additional funds came from related firms and insurance companies.
Some of those owners along with former NECC employees are under indictment for charges ranging from mail and wire fraud to second degree murder. All have entered not guilty pleas and are awaiting trial.

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