Bankrupt firm's owners took out millions

Jan. 22, 2013 at 8:00 PM
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FRAMINGHAM, Mass., Jan. 22 (UPI) -- Owners of a bankrupt Massachusetts pharmacy blamed for a deadly meningitis outbreak got millions of dollars in pay and profits last year, court records show.

The records reveal four family members who co-founded New England Compounding Center in Framingham took out more than $16 million in salary and profits from December 2011 through November 2012, The Boston Globe reported Tuesday. The total is about half the company's sales during the period, the newspaper said.

The compounding pharmaceutical company shut down in early October and filed for Chapter 11 bankruptcy in late December.

Word of the amount received by the owners left an attorney representing unsecured creditors in "shock and amazement."

"It's tremendously unusual," credits committee attorney William R. Baldiga said. "This is not a large company."

The fungal meningitis outbreak linked to the firm has left at least 44 people dead and 678 ill in 19 states, the Centers for Disease Control and Prevention in Atlanta says. The victims had received steroid shots to treat back problems.

Government investigators allege the company failed to keep drug preparation areas clean to avoid contamination and didn't do adequate testing before shipping drugs to pain clinics.

The newspaper said bankruptcy records show Barry Cadden, the lead pharmacist and main executive in charge of the company, and his wife Lisa received a total $6 million during the past year, while her brother Gregory Conigliaro received $1.6 million and Carla Conigliaro, the majority shareholder and wife of Lisa's brother Douglas Conigliaro, pulled out $8.7 million.

The company's sales were $32.4 million last year.

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