Dive Brief:
- Vyaire Medical, a company that makes ventilators and respiratory diagnostics equipment, has filed for Chapter 11 bankruptcy protection.
- Vyaire struggled to refinance its debt after “below-plan performance” in the first half of the financial year. The company has total assets between $100 million and $500 million, and total liabilities between $500 million and $1 billion, according to a bankruptcy petition.
- The company, which announced the filing Monday, plans to use the funds to remain open while Vyaire tries to sell some of its business units.
Dive Insight:
Demand for Vyaire’s products declined after the start of the COVID-19 pandemic. The Department of Health and Human Services ended a $407.9 million contract early with Vyaire in September 2020, after finding there was an adequate supply of ventilators in the Strategic National Stockpile.
Last year, the Mettawa, Illinois-based company sold its respiratory and anesthesia consumables business to Sunmed. Its Airlife manual resuscitators, which were part of that sale, were recalled in March because of a manufacturing defect that can cause the devices to provide inadequate ventilation. The problem was linked to reports of two injuries and two deaths.
Vyaire plans to continue operations while in Chapter 11, and will focus on maintaining services to customers and selling its business units.
“Chapter 11 protection will offer us the breathing room we need to explore selling our businesses to capable, well-financed buyers that have the financial ability and stability to execute on the Respiratory Diagnostics (RDx) and Ventilation business strategies delivering our vital products to customers and patients in need,” CEO John Bibb said in a statement.
Vyaire said the Chapter 11 filing only applies to its U.S. operations and one international holding company.