With U.S. nod, North Little Rock-based Cantrell Drug reopens

FILE — Raw materials used to make a variety of pharmaceuticals sit in the warehouse at Cantrell Drug in Little Rock in this 2011 file photo.
FILE — Raw materials used to make a variety of pharmaceuticals sit in the warehouse at Cantrell Drug in Little Rock in this 2011 file photo.

Cantrell Drug Co. has reopened for business, a few months after the company was all but shut down during a dispute with the U.S. Food and Drug Administration.

The company has lost some $18 million to $20 million in sales this year, Chief Executive Officer James D. "Dell" McCarley Jr. said Tuesday.

"We're at work now," McCarley said. "We have a crew that's going through training and requalification. We'll go into lab production on Wednesday of next week."

McCarley said the company, which manufactures and distributes injectable drugs primarily for hospitals, was able to retain 50 of the 90 employees it had in February, when the FDA sued the company, alleging safety and health violations.

"We'll be back up to 50 percent of what we were producing in six to eight weeks," McCarley said, estimating that a return to full production will take six months.

During court hearings this spring, the company projected weekly sales of $340,000.

Cantrell Drug and the FDA reached a consent decree agreement April 19 to allow the company to restart its operations after it passed federal inspections. Those inspections, however, weren't conducted until Aug. 13-22, according to a letter Friday from the FDA to Cantrell Drug.

John W. Diehl, director of the FDA's compliance office for pharmaceuticals, wrote that the company "appears to be in compliance" with the consent decree and "may resume manufacturing, processing, packing, labeling, holding, and distributing drug products."

Diehl said the company must continue to comply with the consent decree, including hiring an auditor to monitor the company's work, with the first audit inspection set to happen within three months. Diehl also set an Oct. 16 meeting with company officials at the FDA's regional office in Dallas.

Those matters are routine, McCarley said. "It's a restart," he said. "It's been submitted to the FDA that we've got a very well-organized plan."

Founded in 1962 as a traditional retail pharmacy, Cantrell Drug in 2000 began focusing on drug-compounding.

Its specialty now is on producing drugs that are on the FDA's critical-shortage list, including a morphine sulfate used in hospitals.

Despite the monthslong lull in production, Cantrell still has its client and vendor base and a market "for a critical drug on the national drug-shortage list," McCarley said. "The drugs we make help save lives." The company also will soon begin production of injectable hydromorphone, an opioid sold under the brand name Dilaudid.

Other companies made those drugs during Cantrell's shutdown "but not enough to meet demand, and hospitals have been scrambling" for supplies, McCarley said.

Steven Weintz, the company's vice president, said Cantrell Drug is hiring, with the first 18 new employees ranging "from microbiologists to labeling technicians."

McCarley said the 50 employees still at Cantrell Drug "were very loyal and decided to stick it out with us after their unemployment benefits ran out."

He said he and his wife "put in a tremendous amount of money from savings on keeping the overhead paid, keeping the bills paid."

The FDA's lawsuit against Cantrell Drug coincided with the company's travails in federal bankruptcy court. The company in late 2017 filed for voluntary bankruptcy protection while it reorganizes.

At one point this spring, FDA Commissioner Scott Gottlieb said in a statement that the company's "reckless activity threatens public safety and will not be tolerated." The statement angered Cantrell Drug officials, who said there was no evidence that its products had harmed anyone and that no products were recalled by the FDA.

"We've had our differences, but we're excited about a new relationship with the FDA," Weintz said. "We feel like we understand each other better. We share the ultimate goal of safety and the efficacy of a good and helpful product."

Business on 09/26/2018

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