Inotiv files for bankruptcy protection

September 2026 | DEALFRONT | BANKRUPTCY & CORPORATE RESTRUCTURING

Financier Worldwide Magazine

September 2026 Issue

In a bid to reduce its debt by approximately $326m, contract research organisation Inotiv has filed for Chapter 11 bankruptcy protection to facilitate a restructuring support agreement (RSA) with its pre-petition first lien lenders and an ad hoc group of noteholders.

In its Chapter 11 court filings, Inotiv said its financial difficulties stemmed in part from ongoing litigation related to the Envigo case, which resulted in the company, as Envigo’s parent, paying a $35m fine after pleading guilty to conspiring to violate the Animal Welfare Act and the Clean Water Act.

Inotiv also attributed its filing and restructuring to intense cost competition from other contract research organisations conducting animal studies, together with the challenges of operating in a highly regulated environment.

The company provides non-clinical and analytical drug discovery and development services, as well as research models and related products. Its work supports pharmaceutical and medical device companies through the discovery and preclinical stages of development, helping to improve efficiency, enhance data quality and reduce development costs.

“We have been working with our key financial stakeholders to explore strategic alternatives and believe we have determined a path forward that will enable us to support the Company and our long-term strategic vision,” said Bob Leasure, president and chief executive of Inotiv. “Our operating teams remain committed to focusing on our clients and continuing to improve our business model.

“By taking proactive steps to strengthen our financial foundation and capital structure, Inotiv will have additional flexibility to advance our strategic initiatives and deliver value to our clients,” he continued. “I want to thank our dedicated employees, loyal clients and partners and our financial stakeholders for their continued support.”

Alongside the RSA, the company began soliciting votes on a pre-packaged plan of reorganisation and secured affirmative votes from holders representing the required majorities across all tranches of its capital structure under its credit agreement and bond indentures.

Inotiv also filed a number of customary motions with the bankruptcy court to ensure day-to-day operations were not disrupted during the Chapter 11 process. These included an all-trade motion enabling the company to continue paying vendors and suppliers in the ordinary course of business, as well as a wages motion allowing it to meet employee obligations and maintain benefits.

The company also received commitments for $25m in new-money debtor-in-possession financing, in addition to $40m in bridge financing. The funds were intended to support operations throughout the restructuring process and provide the liquidity needed to maintain business continuity.

Ropes & Gray LLP is acting as legal counsel to Inotiv, with Perella Weinberg Partners serving as investment banker and FTI Consulting acting as financial and communications adviser. The pre-petition first lien lenders are advised by Davis Polk & Wardwell LLP as legal counsel and BRG as financial adviser. The noteholder ad hoc group is advised by Paul, Weiss, Rifkind, Wharton & Garrison LLP as legal counsel.

Inotiv stated that it would continue normal business operations throughout the restructuring process. Since the filing, the company has made rapid progress through Chapter 11. The US Bankruptcy Court for the Southern District of Texas confirmed Inotiv’s plan of reorganisation on 14 July 2026, and the restructuring became effective on 19 July 2026, allowing the company to emerge from Chapter 11 with substantially reduced debt and a strengthened balance sheet. The recapitalisation eliminated approximately $326m of debt and positioned the business to continue serving clients as a better-capitalised organisation.

Following court approval and the successful completion of its restructuring, Inotiv has emerged from Chapter 11 with significantly lower debt, enhanced financial flexibility and a strengthened platform from which to pursue its long-term growth and operational objectives.

Fraser Tennant