NECC settlement establishes $100 million fund for victims

January 2, 2014

The New England Compounding Center's owners and insurers agreed to establish a $100 million compensation fund for its creditors, including the victims who were injured after receiving injections of contaminated steroids produced by the now bankrupt NECC. Victims have until Wednesday, January 15 to submit their claims in the case.

More than 700 individuals were diagnosed with fungal meningitis or other fungal infections and 64 died after being injected with preservative-free methylprednisolone acetate that was not sterile, according to the Centers for Disease Control and Prevention.

NECC recalled three lots of steroids from facilities from 23 states on Sept. 26, 2012. At that time more than 300 people had developed fungal meningitis or fungal infections from the compounded steroids used for pain relief and 23 had died. NECC had compounded medications beyond the scope of its license, acting like a manufacturer. The pharmacy distributed large batches of compounded steroid products directly to healthcare facilities without obtaining a prescription for each individual patient, according to the Massachusetts Department of Health and Human Services.

“We are pleased that a significant amount of funds will become available for distribution to victims and their families as compensation for the deaths, injuries, and suffering they endured as a result of this tragic meningitis outbreak,” said Paul Moore, the trustee of bankrupt NECC.

The $100 million settlement will be funded by NECC owners and insurance proceeds as well as tax refunds, and the sale of a related business, according to Thomas Sobol, lead counsel for the Plaintiffs Steering Committee.

For more information regarding the filing date and the proof of claim process, go to http://www.donlinrecano.com/cases/proofofclaim/necp.