Inotiv Reaches Agreement to Resolve Previously-Announced Investigation into Shuttered Cumberland Facility
June 03 2024 - 1:24PM
Inotiv Inc. – Inotiv Inc. (“Inotiv” or the “Company”) (Nasdaq:
NOTV), a leading contract research organization dedicated to
providing nonclinical and analytical drug discovery and development
services and research models, today announced that it reached an
agreement with the U.S. Department of Justice (“DOJ”) to resolve a
previously-announced criminal investigation into the shuttered
canine breeding facility located in Cumberland, Virginia, which was
operated originally by Envigo RMS LLC (“Envigo”), a company
acquired by Inotiv in November 2021. Before the United States
District Court for the Western District of Virginia, Envigo RMS
pleaded guilty to one misdemeanor count of conspiracy to violate
the Animal Welfare Act and Envigo Global Services, Inc. pleaded
guilty to one felony count of conspiracy to violate the Clean Water
Act.
Inotiv issued the following statement:
“Today’s agreement will allow us to
comprehensively resolve this matter, bringing to an end uncertainty
around the investigation, and enabling the Company to focus our
full attention on providing our customers with the tools and
solutions they need to conduct critical drug discovery and
development efforts that are essential to saving human lives.
“Inotiv’s top priority has always been – and
remains – practicing appropriate standards of animal welfare for
our animals, while supporting the scientific objectives of the
studies conducted. We strive to maintain facilities that are
compliant with applicable federal, state, and local laws and
regulations and consistent with our core value to always do the
right thing. That is why we worked to reach this agreement, and why
we have agreed to go above and beyond those legal
requirements.”
Under the terms of the resolution, Inotiv agreed to make
payments totaling $22 million in fines, to be paid over a four-year
period between 2025 and 2028. The first payment is due June of
2025. Additionally, Inotiv agreed to continue to make improvements
to facilities and personnel related to the welfare of animals and
will invest a minimum of $7 million in these improvements over a
period of three years, which is considered by the Company to be in
the ordinary course of business. As part of this resolution, Inotiv
also has paid $3 million, split between the Virginia Animal
Fighting Taskforce and the Humane Society of the United States in
acknowledgement of assistance provided to the U.S. Government’s
investigation, and $3.5 million to the National Fish and Wildlife
Foundation to fund environmental projects, studies, and initiatives
adjacent to the Cumberland facility. Inotiv has also agreed to
certain other non-monetary conditions as part of the
resolution.
In connection with the resolution, Inotiv has entered into an
amendment to its credit facilities with its senior secured lenders
to facilitate its compliance with the terms of the resolution.
Moving forward, the Company plans to continue to take important
steps toward best-in-class animal welfare practices and a culture
of compliance across its operations. Additional details about
Inotiv’s longstanding commitment to animal welfare and a timeline
of the facts can be found at www.Inotivco.com/about/Cumberland.
About Inotiv
Inotiv, Inc. is a leading contract research
organization dedicated to providing nonclinical and analytical drug
discovery and development services and research models and related
products and services. The Company’s products and services focus on
bringing new drugs and medical devices through the discovery and
preclinical phases of development, all while increasing efficiency,
improving data, and reducing the cost of taking new drugs to
market. Inotiv is committed to supporting discovery and development
objectives as well as helping researchers realize the full
potential of their critical R&D projects, all while working
together to build a healthier and safer world. Further information
about Inotiv can be found here: https://www.inotivco.com/.
This release contains “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995 that involve substantial risks and
uncertainties. All statements, other than statements of historical
fact included in this release, are forward-looking statements,
including, but not limited to, statements about the full resolution
of matters related to the Cumberland facility, which is subject to
court approval at a sentencing hearing; the Company’s ability to
make payments and take other actions required by the resolution;
the impact of the resolution on the Company’s financial statements;
the impact of the resolution on the Company’s business, results of
operations and financial condition; the result of the Company’s
improvements and efforts, including on compliance matters; and the
impact of the resolution on the Company’s common stock, its
relationships with employees, customers and suppliers. You can
identify forward-looking statements by the fact that they do not
relate strictly to historical or current facts. These statements
may include words such as “anticipate,” “estimate,” “expect,”
“project,” “plan,” “intend,” “believe,” “may,” “outlook,” “will,”
“should,” “can have,” “likely,” and other words and terms of
similar meaning in connection with any discussion of the timing or
nature of future operating or financial performance or other
events. All forward-looking statements are subject to significant
risks, uncertainties and changes in circumstances that could cause
actual results and outcomes to differ materially from the
forward-looking statements. These forward-looking statements are
not guarantees of future performance and involve risks, assumptions
and uncertainties, including, without limitation, those that are
described in the Company’s most recent Annual Report on Form 10-K,
in the Company’s Quarterly Reports on Form 10-Q, and in other
documents that the Company files or furnishes with the Securities
and Exchange Commission. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual outcomes may vary materially from those indicated
or anticipated by such forward-looking statements. Accordingly, you
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date they are made. Except
to the extent required by law, the Company does not undertake, and
expressly disclaims, any duty or obligation to update publicly any
forward-looking statement after the date of this announcement,
whether as a result of new information, future events, changes in
assumptions or otherwise.
Company ContactInotiv, IncBeth
A. Taylor, Chief Financial Officer(765)
497-8381btaylor@inotivco.com
Media ContactKekst
CNCInotivInquiries@KekstCNC.com
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