NECC Asks For $100M Bankruptcy Settlement In Nationwide Meningitis Outbreak
BOSTON (CBS) -- A bankruptcy judge has been asked to approve a $100 million settlement for victims of tainted steroids made by New England Compounding Center.
Under the settlements, NECC's owners, its insurers and one of its affiliates will contribute an aggregate amount estimated to exceed $100 million to a compensation fund to be distributed to NECC creditors, including those who died or suffered significant injuries after receiving injections of tainted steroids traced to NECC.
NECC's owners will contribute nearly $50 million in cash to the victim compensation fund. Those cash payments are expected to entitle the owners to tax refunds projected to total over $20 million, and substantially all of those refunds will also go to the common fund.
NECC's owners will further contribute the proceeds of NECC's and a related company's insurance policies, totaling nearly $29 million, which may add an additional $10 million to the fund.
In the fall, nearly a year after the nationwide meningitis outbreak, a multi-party lawsuit was filed suing NECC with negligence.
NECC was the manufacturer of steroid shots contaminated with black mold that were distributed to medical facilities in at least 23 states exposing thousands of patients to fungal meningitis. More than 60 have died and 750 people in 20 states were injured.
"We know that no amount of money can adequately compensate the bereaved families for their loss of loved ones, nor those who are suffering today from the terrible effects of this tragedy," The Shareholders of New England Compounding Center said in a statement. "Our thoughts and prayers continue to be with all those who have suffered, and their loved ones."
The settlement is being called a victory for victims, but for some, it's too late.
"It's just working its way through my body and sometimes it's crippling," says Kel Papeleo of Boxborough.
At 46 years old, she suffers from boils, constant infection, vision loss, and then last year, she collapsed from a heart attack.
"I was living with the pain the whole time and it was growing and growing and growing to the point where it killed me," she says.
It all stems from an injection sold by NECC.
According to victims' attorney Kristen Johnson, those suffering could see the money next year.
"The reality is there will never be enough money to compensate these victims and their families for all they have lost," Johnson says. "But this is a very good starting point."
For Kel, that's too late. She can't afford the $1,500 per month medication that could save her life and her hospital bills are stacking up.
"It would be great to have some money to get some medication, but it's not going to give me my life back," she says.
