The stock at last check was more than 26% lower at 21 cents after the Lake Forest, Ill., the drugmaker said it filed the petition in U.S. Bankruptcy Court in Delaware.
In its court filing, Akorn listed debt of as much as $10 billion and a similar amount of assets, Bloomberg reported.
Akorn has been warning of a potential bankruptcy filing, having faced a series of mounting challenges since Fresenius SE roughly 18 months ago pulled the plug on a $4.75 billion deal to acquire Akorn.
The German health care giant had hoped the deal, first announced in April 2017, would arm it with a wider array of drugs to offer hospitals and pharmacies.
But after conducting an investigation, Fresenius in April 2018 said it had discovered "material breaches" involving "[Food and Drug Administration] data integrity requirements in Akorn's operations, including product development."
Akorn strongly disputed the findings, with the two sides locked in litigation since Fresenius decided to terminate the deal in late 2018. That move followed a rare court ruling in the Delaware Court of Chancery allowing the health care giant to walk away from the deal.
In 2019, the U.S. FDA issued warning letters to Akorn over alleged manufacturing violations at its plants in Decatur, Ill., and Somerset, N.J.
In a statement on its bankruptcy court filing, Akorn said it reached an agreement with lenders holding 80% of its secured debt.
The lenders will serve as a stalking-horse bidder and provide "additional liquidity" to pay for its operations as Akorn continues its search for a buyer during the bankruptcy process.
Akorn said it had access to $30 million in debtor-in-possession financing.