Joel R. Glucksman
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201-896-7095 jglucksman@sh-law.comFirm Insights
Microphage Files For Chapter 11 Bankruptcy Protection
Author: Joel R. Glucksman
Date: January 15, 2013
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Microphage, a company that specializes in bacterial detection innovation and technology, has filed for Chapter 11 bankruptcy protection under bankruptcy law in Colorado.
The company listed assets from $500,000 to $1 million, and liabilities between $1 million and $10 million.
Microphage is best known as the manufacturer of the first U.S. blood test that identifies antibiotic-resistant staph infections, according to the Denver Business Journal. The technology works similarly to other instrument-free test kits, and allows individuals to determine the results in a matter of hours, rather than days. The company first began marketing the test kits in Europe in 2009, and later received approval from the Federal Drug Administration to market them in the U.S. in 2011.
Following production of this product, known as KeyPath, the group signed an agreement with Cardinal Health that would not only allow it to fund its operations, but also distribute its products widely among hospitals and clinics throughout the U.S. Cardinal Health – one of the nation’s largest medical distributors – is listed as the group’s largest creditor, with $2 million in claims against Microphage. Roughly $1 million of this amount is secured.
Jack Wheeler, who co-founded Microphage in 2002, noted that the group was primarily funded with angel investors before the deal with Cardinal was finalized, and said he is disappointed that the company is forced to go the bankruptcy protection route.
“I think that the technology was extraordinarily strong,” he told Colorado newspaper the Times Call. “It was unfortunate that we didn’t have the significant funding the last four or five years that was needed. In the field of clinical diagnostics, you need significantly more investments than an angel investor can provide.”
If you face bankruptcy issues in your business or would like to discuss the topic above, please call me, Joel Glucksman.
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