The namesake facility operated by Cantrell Drug Company, owned by Dr. James L. "Dell" McCarley Jr. (inset) and his wife Lynn.
Cantrell Drug Co., already reorganizing under bankruptcy court protection, may not survive another week after the U.S. Food & Drug Administration alerted health care professionals and patients not to use drugs from the Little Rock company.
The FDA’s March 1 news release also said that federal regulators were seeking a preliminary injunction to stop Cantrell’s production and distribution of compounded drugs.
The fallout from the news release has been “devastating” to the company, James L. McCarley Jr., the CEO of Cantrell Drug, testified Wednesday during a hearing in U.S. Bankruptcy Court in Little Rock. He said that 20,000 pharmaceutical compounds that were in the process of being made were canceled by health care providers.
The news release came a day after the U.S. Department of Justice, on behalf of the FDA, sued to stop Cantrell Drug and McCarley from manufacturing or selling products the FDA alleged were unsafe.
“Health care professionals should immediately check their medical supplies, quarantine any drug products from Cantrell Drug Co. and not administer them to patients,” the news release said. “Patients who have received any drug product by Cantrell and have concerns should contact their health care professional.”
Cantrell Drug’s bankruptcy attorney, Kevin Keech of Little Rock, denied the allegations. “Not one single patient has been hurt” by Cantrell Drug’s products, he told U.S. Bankruptcy Judge Phyllis M. Jones in a courtroom packed with more than 40 of Cantrell Drug’s employees.
Keech wants Jones to order the FDA to retract the news release and prevent the DOJ from going forward for at least 45 days with its civil lawsuit in U.S. District Court in Little Rock.
“Cantrell Drugs is not going to make it to next week,” Keech said. He said that the company would then move to bankruptcy liquidation and McCarley would have to file for personal bankruptcy.
The hearing on Cantrell Drug’s emergency motion continued to Thursday, after Arkansas Business’ deadline.
Raquel Toledo, an attorney for the DOJ, told Jones Wednesday that Cantrell’s products pose a “serious risk” to patients’ health and the company “doesn’t seem to realize that.”
She said that taking steps to shut down a drug compounding company is “extremely rare” and the FDA is shutting down Cantrell Drug because of the unsanitary conditions at the company.
“The government doesn’t take this step lightly,” she said. But Cantrell Drug has “brought it on themselves,” Toledo said.
Problem With Microbes
Microbiological contamination of injectable drug products “is a significant problem,” according to a statement from Brooke Higgins, a compliance officer and senior policy adviser at the FDA. Her statement was included in the DOJ’s court filings.
Higgins said her review of FDA inspections of Cantrell Drug’s facility in Little Rock found “that all of Cantrell’s compounded drug products intended to be sterile are at risk of contamination.”
She also accused the company of failing to follow its written procedures to prevent contamination of drug products purporting to be sterile.
The FDA has “no confidence” in the reliability of the data reported by Cantrell employees. “For example, during the 2017 inspection, FDA investigators observed microbial growth on environmental monitoring plates that Cantrell employees recorded as containing no growth,” Higgins wrote.
A 2016 inspection led to Cantrell Drug voluntarily recalling certain products “due to lack of sterility assurance,” according to a Cantrell Drug news release. In July 2017, Cantrell Drug made a similar announcement, but this time it was for all sterile drug products. McCarley said the recalls led to the company filing for bankruptcy reorganization in November, listing $7.46 million in debts and $15.1 million in assets.
Still, the company said it has seen financial improvement since the bankruptcy filing. It has hired about 25 people, bringing the total to about 85, and had seen its sales improve. In January, it reported sales of $1.4 million, up from $1.1 million in December, according to the company’s most recent monthly operating report on file.
But after the FDA news release on March 1, sales have been “decimated” and were reduced by 100 percent, McCarley testified Wednesday.
The company had projected it would have $340,000 a week in sales. “My honest desire is to do things right and fully comply with all the FDA’s regulations,” McCarley wrote in a March 1 news release. “I’ve dedicated the last 12 months and most of my life’s savings trying to satisfy the Agency.”
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