![]() “This is corporate greed at its very worst and a reminder why Congress and the White House can’t let up on their work holding bad industry actors accountable,” he said. “Adding insult to injury, before the shoe dropped, Endo’s executives apparently tried to squeeze out every last drop of personal gain at the expense of so many families’ misery and grief.” ![]() “It’s bad enough that one of the biggest alleged pushers of the opioid epidemic is trying to dodge responsibility to its victims,” said Jeremy Funk, spokesman for the nonpartisan watchdog group Accountable U.S. The firm also manufactured and marketed the branded Opana pain pill and generic opioids.Įndo voluntarily withdrew Opana ER from the market in 2017 after the Food and Drug Administration asked it to because of the dangers of abuse.Įndo says that Opana accounted for less than 1% of the opioid market. ![]() “The No Bonuses in Bankruptcy Act would prohibit failed executives from walking away with cushy bonuses during their business’ bankruptcy proceedings,” Burchett said in a news release when the legislation was introduced to the House.Ĭongress has not acted on the proposed legislation.Įndo, run out of Malvern, Pennsylvania, corporate offices and based in Ireland for tax purposes, is best known for Percocet pain pills. Tim Burchett (R., Tenn.) and Cheri Bustos (D., Ill.) introduced legislation cracking down on corporations that pay big bonuses to executives before or during bankruptcy. ![]() The GAO added that “nearly all stakeholders GAO interviewed viewed pre-bankruptcy bonuses as problematic” because they cut into the funds available to reorganize the company and are “are awarded without notice to creditors or court approval.” Proposed law would prevent ‘cushy bonuses’ also handed out executive bonuses shortly before their bankruptcies.įederal law makes it difficult – “nearly impossible” – to give executives retention bonuses during bankruptcy, so companies “use pre-bankruptcy bonuses as a workaround,” the GAO said report last September. Sears Holdings Corp., Neiman Marcus Group Inc., and Whiting Petroleum Corp. Hertz paid more than $16 million in bonuses three days before its May 2020 Chapter 11 filing, just a month after laying off 10,000 workers, Bloomberg Law reported.Ĭhesapeake Energy paid $25 million ahead of its June 2020 filing, Bloomberg said. The Government Accountability Office, or GAO, investigated pre-bankruptcy bonuses in 2021. The company faces 3,100 opioid suits, many brought by government entities. “In addition, the payments are subject to the recipient’s continued employment with Endo over multiple years.” Big financial losses and high legal costsĮndo reported earlier this month that second-quarter revenues fell 20%, mostly because of new generic competition on its branded Vasostrict drug for a diabetes condition, and it lost $1.9 billion.Ī bankruptcy court filing says Endo spends more than $200 million a year on litigation costs for opioid and other lawsuits, twice what it spends on research and development. “Importantly, up to the whole amount of the performance-based component must be repaid if certain preestablished financial and operational targets are not met in 20,” the statement said. “Ordinary people who are not paid millions of dollars wonder why a company should be paying out millions of dollars to people who oversaw the demise of a company.”Īn Endo spokesperson said in a statement that “the recent incentive and retention payments are critical to the continuity of Endo’s business during the Chapter 11 proceedings and were approved by Endo’s independent board members.” “I would not say it’s normal for a company to pay significant retention bonuses twice before bankruptcy,” Temple University law professor Jonathan Lipson said Monday. They aren’t scrutinized by the bankruptcy court or creditors, and they siphon money out of the funds available for the business, or settling debts. Pre-bankruptcy bonuses reward executives for failing enterprises, critics say. 16, court and regulatory records show.Įndo describes them as prepaid incentives and management retention. The firm drug paid a second round of bonuses right before the actual bankruptcy filing in Manhattan on Aug. It was, in fact, the latest installment of an eye-popping $55.5 million in pre-bankruptcy bonuses paid over 10 months to Coleman and three other top executives at the drug firm, which faces potentially huge legal liability for its part in the nation’s opioid epidemic.Įndo manufactured and marketed hundreds of millions of branded Opana and generic opioid pain pills.Įndo paid the first bonuses last November when it considered an earlier bankruptcy date. Days before the money-losing opioid drug firm Endo International filed for bankruptcy last week, the company paid chief executive Blaise Coleman an $11.85 million bonus.
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