Opioid maker Insys Therapreutics (INSY) was down 36% in trading Monday after the company announced it will be filing for Chapter 11 bankruptcy protection due to the financial burden from litigation tied to its role in the opioid crisis in the United States.
The company, which filed for bankruptcy in Delaware, said that the move would facilitate the sale of "substantially all of the company's assets and address the company's legacy legal liabilities."
It said it would continue to operate its business "in the ordinary course" while it sells off its assets through bankruptcy court.
"After conducting a thorough review of available strategic alternatives, we determined that a court-supervised sale process is the best course of action to maximize the value of our assets and address our legacy legal challenges in a fair and transparent manner," said CEO Andrew G. Long.
Just last week, Insys agreed to pay $225 million to settle federal charges over its opioid sales.
Company's use Chapter 11 in order to facilitate the auction and sales process of its assets, providing it with protection from creditors while also maximizing the sale value for those creditors. Insys said it hopes to complete the asset sales within 90 days.
The company previously has said that it had liabilities of $240.3 million as of the end of March. It also said that it may not be able to complete its final settlement with the Department of Justice.
In its most recent filing, the company reported a net loss of $123.88 million with a cash pile of $87.6 million.
Shares were trading at 37 cents in premarket trading Monday. This time last year they were worth 10 times as much.