Generic drugmaker Teligent files for Chapter 11, considers sale

(Reuters) – Generic drugmaker Teligent Inc filed for bankruptcy on Thursday with intent to sell, citing “regulatory and legal setbacks” including a warning letter from the Food and Drug Administration of the United States regarding its manufacturing processes.

Teligent listed on the stock exchange filed for chapter 11 protection in U.S. bankruptcy court in Wilmington, Delaware, with nearly $ 130 million in debt, saying the COVID-19 pandemic also contributed to it facing a cash crunch in 2021.

The company, represented by Michael Nestor of Young Conaway Stargatt & Taylor, said in a statement that it is in talks with several interested parties about the acquisition of its business and that it plans to close a sale by now. early 2022.

As part of the bankruptcy filing, Teligent appointed Vladimir Kasparov, Managing Director of Portage Point Partners, as Director of Restructuring, putting him in charge of overseeing the restructuring process.

K&L Gates was retained as legal counsel to advise on transactional matters relating to Virginia bankruptcy laws. Raymond James & Associates is its investment banker.

To fund its operations during the Chapter 11 process, the company said it arranged $ 12 million in debtor-in-debt financing from its senior secured lenders.

In one court filingKasparov said the company, which makes topical pharmaceuticals and other generic drugs, pointed to a 2019 warning letter from the FDA as an initial event leading to bankruptcy.

The letter, which stems from an inspection of Teligent’s factory in Buena, New Jersey, identified several violations of good manufacturing practice rules and called on the company to take action to bring itself into compliance.

A product review initiated by the company resulted in recalls and production halt of some products, and the company was prevented from launching a new line of sterile injectables.

Kasparov said the ongoing FDA inspections “have had a significant negative impact on the business, financial condition, results of operations and cash flow of the company.”

The onset of the COVID-19 pandemic in March 2020 has further negatively impacted the business and exacerbated pressure on its operations and cash flow, he said. He received $ 3.3 million under the federal paycheck protection loan program.

The case is In re: Teligent Inc, US Bankruptcy Court, District of Delaware, No. 21-11332.

For Teligent: Michael Nestor and Matthew Lunn from Young Conaway Stargatt & Taylor

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