S&P cuts Endo International

S&P said it lowered Endo International plc’s issuer rating to B- from B.

“Our rating action primarily reflects the mounting opioid-related litigation that we expect will result in significant liabilities. In April 2021, the Circuit Court for Sullivan County, Tenn. issued an order granting a default judgment on liability against Endo as a sanction for alleged discovery improprieties in a case related to the sale of opioids in Tennessee,” the agency said in a press release.

“We think the orders from the court of appeals increase the probability that Endo is assigned damages for its alleged role in Tennessee's opioid crisis, and the damages could be substantial, given the plaintiffs have claimed $2.4 billion of prospective damages. We view the probability of success on appeal as lower than for the original trial,” S&P said.

S&P noted considerable uncertainty over the California trial.

The agency said it sees Endo's gross credit metrics materially weakening over the next two years.

The outlook is negative.

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