The company is facing lawsuits from patients who had vaginal mesh implants put in that have since eroded, causing pain and leaving many victims incontinent.
Endo's product liability lawsuits have resulted in the company setting aside a total of $2.6 billion in an effort to satisfy the lawsuits the company faces. The company, based in Dublin, has also shuttered one of its units responsible for manufacturing mesh implants.
The implants were designed to treat incontinence and help support the patient's internal organs.
Endo president, and CEO, Paul Campanelli, states that they have reached agreement to "resolve virtually all known U.S. mesh product liability claims."
Mesh product liability claims have plagued several large companies, including Johnson & Johnson (JNJ), who has spent tens of millions of dollars to settle lawsuits. The company listed in their SEC filing in February that they were defending themselves against 54,800 lawsuits,
The company has since settled some of their lawsuits, but still remains under pressure, with tens of thousands of cases remaining.
The U.S. FDA concluded in 2014 that mesh inserts were a high risk. The agency had ordered several of the manufacturers of mesh inserts to conduct studies on organ damage associated with mesh products. Johnson & Johnson had already dropped some of their mesh products in 2012 due to product defects.
Endo expects the $775 million set aside to cover the current 22,000 lawsuits that remain in the United States and cases that are pending internationally. The company will make installment payments into the final quarter of 2019.
Endo's stock has suffered from the pending lawsuits, with the company's stock tumbling 65% in the past year, 41% in the past 3 months and 32% over the past month. The company posted a second-quarter loss this week, with the company posting a $6.26 per share loss.
The staggering losses have led the company's stock to plummet to 14-year lows. The company expects their full-year earnings to be positive, with earnings of $3.35 - $3.65 per share and revenue ranging from $3.38 billion to $3.53 billion.
Endo states that resolving the remaining lawsuits will allow the company to move forward with their core strategic priorities.
The company is unaware of any lawsuits that are not covered under the agreement.Date Of Update: 31 August 2017, 02:53