US$256m impairment leads to Aceto loss
An impairment charge of US$256 million relating to Aceto’s Rising Pharmaceuticals generics business has led the firm to a US$259 million operating loss in its financial third quarter ended 31 March 2018. The goodwill and intangible asset impairment followed “a decline in actual and forecasted revenue and earnings due to persistent adverse conditions in the generics market”, as well as a notification from the US government that 11 products previously purchased from Lucid are not in compliance with country-of-origin requirements of government contracts (Generics bulletin, 9 March 2018, page 4).
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Aceto has completed the divestment of its Rising Pharmaceuticals generics unit, is moving ahead with the disposal of its chemicals business and has disclosed a bonus incentive scheme for its CEO, William Kennally, aimed at securing the maximum value for its assets as part of bankruptcy proceedings.
Struggling US firm Aceto has filed Chapter 11 bankruptcy petitions at the same time as agreeing to divest its chemicals business assets for US$338 million, with plans to also offload its Rising Pharmaceuticals unit.
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