Moody's lowers MedImpact

Moody's Investors Service said it downgraded the corporate family rating of MedImpact Holdings, Inc. to Caa2 from B3. Moody's also said it lowered the company's probability of default rating to Caa1 from B3.

At the same time, Moody's downgraded MedImpact's senior secured notes to Caa3 from Caa2 and changed the company's speculative grade liquidity rating to SGL-3 from SGL-2.

The outlook is stable.

Moody's said the downgrades to a Caa2 corporate family rating and Caa1 probability of default are based on concerns that MedImpact will not meet the agency's expectations for profitability or cash flow generation over the next 12 to 18 months.

The Caa2 corporate family rating reflects a higher likelihood, in Moody's view, that MedImpact's capital structure is unsustainable and the company could face potential liquidity challenges.

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