The New England Compounding Center has been blamed for the fatal fungal meningitis outbreak that recently killed 44 people and left another 650 seriously ill. Plaintiffs’ lawyers always speak in moderated terms, avoiding phrases like “we have they dead to rights.” But, boy, it sure looks like an open and shut case from where I’m standing.
Anyway, a Massachusetts bankruptcy court judge has frozen the assets of the specialty pharmacy’s four owners so that victims and creditors may make claims against the company. Under the new court order, NECC’s owners will be unable to access their assets other than to pay legal bills and living expenses. NECC had previously filed for Chapter 11 protection and is already facing 150 lawsuits. A hearing has been scheduled for February 28, 2013.
The deadly meningitis outbreak has been linked to a steroid injection produced by NECC. A government investigation revealed unsanitary pharmacy conditions and flawed sterility testing procedures. During an October facility visit, federal investigators found widespread mold among other contaminants. According to the FDA report on NECC, “clean” areas of the facility had visible surface discolorations and standing water. The company voluntarily ceased operations on October 4, 2012.
Last November, NECC’s director was called in front of the House of Representatives to explain the FDA report. He exercised his Fifth Amendment rights and did not comment on NECC’s facilities or the company’s link to the outbreak. Following a denial of liability, NECC blamed its cleaning company, UniFirst. Passing the buck in turn, UniFirst acknowledged that one of its subsidiary companies was contracted to clean NECC’s facilities but asserts that the services were limited and that the unsafe conditions and tainted drugs were not because of the actions of UniFirst employees. UniFirst reports that it sent two employees to NECC once a month for a total of ninety minutes. UniFirst also claims that the janitorial team only used NECC’s cleaning solutions.
This is not the first time NECC has been under scrutiny for failing government inspections or shipping tainted products. In 2003 the company had problems with contaminated medication and in 2006 the company was cited for unclean conditions.
Last year, at least 89 medical facilities in Maryland received drug shipments from NECC. Some of these shipments were linked to deadly steroids. Maryland buyers include the University of Maryland Medical Center, Northwest Hospital, and Greater Baltimore Medical Center. More than 3,000 facilities nationwide purchased from NECC.
In December the company listed only $400,000 in net assets. The company said it identified those assets for the purpose of victim compensation. Attorneys for victims and their families explain that $400,000 is not nearly sufficient to cover actual damages. NECC also disclosed that during the last 11 months the company has paid $21 million to company employees and owners. Over the past six years, the company has made a total of $70.5 million in similar payments.
If you suffered an illness or lost a loved one due to the fungal meningitis outbreak caused by the tainted steroids, contact our lawyers at 1.800.553.8082, or online, in order to discuss your case.