Moody's downgrades Akorn

Moody's Investors Service said it lowered the ratings of Akorn Operating Co. LLC, including the corporate family rating to Caa2 from Caa1, the probability of default rating to Caa2-PD from Caa1-PD and the senior secured term loan to Caa3 from Caa2. The outlook was revised to stable from positive.

“The ratings downgrade reflects Akorn's significant reduction in scale and diversity following the divestitures of the over-the-counter consumer health segment and branded pharmaceuticals segments, as well as the closure of Akorn's Somerset, New Jersey manufacturing facility. The sale of the more profitable business segments has materially reduced the company's earnings, and ability to sustain stand-alone operations,” Moody’s said in a press release.

The stable outlook reflects the expectation that Akorn will continue operating with a modest scale and very high financial leverage, Moody’s said.

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