Endo International PLC said Thursday that it has elected not to make a $38 million payment owed to its bondholders as the drug producer contends with declining earnings and thousands of lawsuits alleging it fueled the opioid crisis, WSJ Pro Bankruptcy reported. Endo is continuing discussions with creditors regarding its evaluation of strategic alternatives, the company said, and has entered a 30-day period before its failure to make the payment would constitute an event of default. Endo, which faces about 3,500 lawsuits from state and local governments and healthcare providers, has been warning of the risk of a bankruptcy filing in its regulatory disclosures since last year. While Endo has reached settlements with a handful of state and local governments over opioid liabilities, the vast majority of outstanding lawsuits have not been resolved. The company has denied wrongdoing in connection with its sales of its Opana opioid, which it stopped selling in 2017. In addition to the litigation that Endo faces, the company is also suffering from declining earnings, in part driven by the loss of exclusivity for a key drug, Vasostrict. The company’s debt load amounts to more than $8 billion. On Monday, a group of junior bondholders publicly urged Endo not to file for bankruptcy, saying there are several possible transactions, such as a bond swap, that would enable Endo to restructure its obligations outside of chapter 11. Endo, which is domiciled in Ireland following a 2014 corporate tax inversion and has operations in Malvern, Pa., on Thursday said that its decision to miss the interest payment is not driven by liquidity constraints, as it had approximately $1.4 billion in cash as of March 31.
