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Aceto Corp. (ACET) - Get Adicet Bio Inc. Report has received a subpoena from the Justice Department as part of its investigation of the generic sector, making any sale more problematic.

The company, which is considering strategic alternatives, revealed the DOJ news in a filing with the Securities and Exchange Commission on Monday, April 23. Aceto sought to walk a fine line as it made investors aware of DOJ's action while at the same time making it sound like business as usual.

"The company is one of many operating companies in the generic pharmaceutical industry to receive a subpoena from the DOJ relating to its years-long investigation into the industry," Aceto said. "The company is currently preparing its response to the subpoena."

Aceto did not respond to a request for comment about how the DOJ request might impact its strategic options going forward.

What the SEC filing doesn't say is that Aceto is not named in the original complaint from Oct. 31 in which 45 states and the DOJ alleged 18 drug companies including Teva Pharmaceuticals USA Inc. (TEVA) - Get Teva Pharmaceutical Industries Limited American Depositary Shares Report and Mylan Pharmaceuticals Inc. (MYL) - Get Viatris, Inc. Report are actively fixing prices in the generic sector. The subpoena, which no doubt requested documents from the company, indicates that on some level prosecutors have taken an interest in Aceto's behavior in the generics market.

The subpoena is not good news for the already troubled company. On April 18, Aceto said because of adverse conditions in the generic category, it anticipated taking a noncash intangible asset impairment charge of between $230 million and $260 million on current generic products as well as pipeline drugs.

In addition to its generic business, the company also develops and sells pharmaceutical ingredients and performance chemicals including specialty and agricultural products. Aceto or its subsidiaries operate in 10 countries and have offices in Port Washington, N.Y., and Saddle Brook, N.J.

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In 2016, Aceto expanded its generic offerings by purchasing a group of products from Citron Pharma LLC for $412 million. Citron is named in the generics lawsuit. But at the time of the products acquisition, Aceto was indemnified by Citron against potential liabilities.

Aceto chairman Al Eilender said in a statement: "Given continued headwinds in the generics market, the board has taken decisive action by bolstering the company's senior leadership, engaging in proactive discussions with its secured lenders and initiating a thorough evaluation of strategic alternatives. The board looks forward to working with and supporting management throughout this process and appreciates the continued dedication of its employees and other stakeholders while it navigates this difficult industry environment."

The company has hired PJT Partners Inc. as its financial adviser, and Lowenstein Sandler LLP will furnish legal counsel regarding the strategic review. The board of directors already has scrubbed the financial guidance for the balance of 2018.

Aceto finished 2017 with $64.9 million in cash. For the six months ended Dec. 31, Aceto had a gross profit of $74 million and a net loss of $13.4 million on $356.5 million in sales. Income from generic products was down $2.6 million in 2017 from one year before.

Aceto is huddling with its secured lenders regarding covenant waivers for the third quarter, and the company moved Rebecca Roof in as interim CFO to cover for Edward Borkowski, who resigned as of April 19. Borkowski's tenure with Aceto was very short; he was only hired on Feb. 16.

Regardless of whether Aceto pursues a sale, the highly competitive generic sector is sure to drive some consolidation deals. This year has seen Sanofi SA (SNY) - Get Sanofi Report strike a deal to sell off its European generics business, and Novartis AG (NVS) - Get Novartis AG Report is considering a sale of its generic dermatology business. Teva is looking at asset sales as it works to deleverage its balance sheet.

Aceto has tapped the private-investment-in-public-equity market before, raising $143.7 million in a convertible debt deal in 2015, according to PrivateRaise, TheStreet's data provider that tracks private placements larger than $1 million.

Aceto investors include BlackRock Fund Advisors at 12.3%, Dimensional Fund Advisors LP at 8.3% and Northern Trust Investments Inc. with 5.4%, according to FactSet Research Systems Inc.