Chicago pharmaceutical firm that grabbed nationwide consideration for elevating the price of its skin medicines has filed for bankruptcy. Novum Pharma registered for Chapter 11 in U.S. Bankruptcy Court in Delaware on Sunday, saying within the submitting that it has “confronted a sequence of monetary and operational difficulties” since shopping for medication from Primus Prescription drugs in 2015.
Novum hopes to promote “considerably all of its belongings” and proceed to work utilizing the chapter course of, following the submitting. The corporate has about 50 full-time staff, most of whom are gross sales representatives who function in 29 states.
The corporate gained notoriety in 2016 after raising the wholesale price of skin gel Alcortin A to $7,968 a tube, following the Elsevier’s Gold Standard Drug Database. The medicine is used to deal with eczema, and sure pores and skin infections, and beforehand had a worth of $226, in response to a U.S. Senate subcommittee report.
The corporate additionally bought one other pores and skin medicine, Aloquin, for a similar wholesale worth. And it offered pores and skin treatment Novacort for $5,952 a tube, in response to Elsevier. Novum defended its pricing on time, saying the quoted costs had been inaccurate. It additionally stated that almost all sufferers with non-public insurance coverage paid no co-pay for Novum merchandise, and people without insurance coverage by no means needed to pay higher than $35.
Novum didn’t reply to requests for a remark by deadline Tuesday. However, in a court submitting, Novum Chief Restructuring Officer Thomas O’Donoghue attributed the corporate’s chapter to manufacturing points, a dispute with a wholesaler and main pharmacy chain, and unauthorized generic options being launched into the market.
He additionally wrote that Novum had had a troublesome time getting its medicine lined beneath medical insurance plans. Trade intermediaries, referred to as pharmacy profit managers, have refused to incorporate Novum’s medicine on prescription formularies, he wrote, which implies insurance policy typically aren’t masking the drugs.