Reva Medical (ASX:RVA) announced today that it has filed for Chapter 11 bankruptcy protection.
San Diego-based Reva — which specializes in bioresorbable polymer tech for vascular applications — entered into a restructuring support agreement with a handful of its stakeholders last month. The goal was to address the company’s outstanding debt.
Reva also filed a prepackaged reorganization plan to provide employee wages and benefits without interruption while paying vendors and suppliers as usual, with court approval. Reva also plans to continue ordinary operations and expects to use provisions in the bankruptcy code that require suppliers to meet the terms of pre-existing contracts.
The company said it secured pre-petition financing worth $4.4 million to help it reach its near-term financial commitments. Reva said it hopes to emerge from the Chapter 11 process “as quickly as practicable” while it maintains focus on its peripheral vascular product line and on developing its embolics business, according to a news release.
“While the clinical outcomes data from the company’s Fantom and Fantom Encore bioresorbable scaffolds (BRS) remain excellent, BRS adoption has been greatly impacted by concerns with clinical data from inferior competitive devices,” Reva president Jeffrey Anderson said in the news release. “As a result, we are focusing on opportunities in the peripheral interventional and embolics market segments.”
The company’s voluntary bankruptcy petition, filed this week in U.S. Bankruptcy Court in Delaware, lists $5.9 million in assets and $104.5 million in debt. Top unsecured claims involved investors: nearly $45 million owed to Elliott Associates, about $25 million owed to Goldman Sachs, and $18 million owed to the Senrigan Master Fund at Senrigan Capital Group.
In February 2019, Reva announced its plans to cut its workforce by 44%, leaving 22 employees remaining at the company at that time.
Executive editor Chris Newmarker contributed to this report.
