Endologix, an Irvine, California-based healthcare company focused on aortic disorders, has filed for Chapter 11 bankruptcy and finalized a “consensual plan of reorganization” with Deerfield Partners, its largest lender.
Under the terms of this new agreement, Endologix will take the company private, shedding approximately $180 million in debt. Approximately $130 million of that debt is currently held by Deerfield and will be converted into equity.
The moves come after a series of financial challenges Endologix has connected to the ongoing COVID-19 pandemic. The company has said it still “fully intends to meet its financial obligations” and is “focused on elevating the standard of care for patients suffering from abdominal aortic aneurysm (AAA).”
“We are excited to begin a new chapter for our organization now characterized by financial stability,” John Onopchenko, CEO of Endologix, said in a statement. “Although COVID-19 has presented a delay in many AAA procedures that, in turn, has negatively impacted our revenue, we remain confident we have taken the right steps to ensure we are consistently providing valued support to customers and the patients we serve with the highest quality products and the most talented and committed employees in the industry. The path we are now taking to strengthen our balance sheet and transition to private ownership will allow us to accelerate our progress with our strong patient-first business focus, an enduring spirit of innovation, and an unrelenting commitment to advancing our life-saving products supported by industry-leading evidence.”
According to Endologix, this process is expected to be complete by the end of 2020’s third quarter. Its Alto Abdominal Stent Graft System is still scheduled to be launched in the U.S. market in the weeks ahead.
“Today’s announcement is a means to a new beginning for Endologix,” Onopchenko added. “Our next chapter enables us to exclusively look forward, continue to earn the trust of our physicians, patients and partners, and remain steadfast in operating with accountability and transparency in everything we do. We firmly believe this is a positive development for our Company and, most importantly, our customers and the patients we proudly serve.”
Michael has more than 16 years of experience as a professional writer and editor. He has written at length about cardiology, radiology, artificial intelligence and other key healthcare topics.