Filing Alert: Inotiv Chapter 11

Update (Jun. 3, 2026): A comprehensive case summary is now available for the Chapter 11 bankruptcy filing of Inotiv, Inc.

Inotiv, Inc. and its debtor affiliates⁽¹⁾, a West Lafayette, IN-based contract research organization that provides nonclinical and analytical drug discovery and development services and supplies research models and related products, filed for Chapter 11 protection on Jun. 3 in the U.S. Bankruptcy Court for the Southern District of Texas.

The company attributes its distress to an overleveraged capital structure—approximately $488.7 million in funded debt—carrying an extraordinary service burden, with a weighted average effective rate exceeding 11.6% on its term loans and 15.00% PIK on its second-lien notes, and the company incurred roughly $27.5 million in total interest expense for the six months ended March 31, 2026. A near-term maturity wall, including approximately $315.4 million of Prepetition Secured Loans coming due in October and November 2026, limited favorable refinancing options and constrained the liquidity needed to fund operations and growth.

Compounding the leverage overhang, the company cites acute sector headwinds: intensifying competition from lower-cost, less-regulated offshore CROs; structural demand uncertainty following the FDA Modernization Act 2.0 and the FDA's April 2025 roadmap to reduce animal testing via new approach methodologies (NAMs); proposed ~40% cuts to the NIH's FY2026 budget; and 10%–20% tariffs on imported NHPs that—coupled with China's 2020 export halt and an accelerated ~30-day duty payment cycle—strained operating liquidity. These pressures contributed to an 8.0% (~$12.6 million) decline in RMS revenue on lower NHP volumes and widened the operating loss to approximately $35.6 million (from ~$18.4 million YoY), against continuing DOJ settlement obligations—a $22.0 million Animal Welfare Act and Clean Water Act fine plus monitoring and remediation costs—carrying roughly $18.1 million in related liabilities as of March 31, 2026. After a PWP-led marketing process commencing July 2025 failed to yield a consummable out-of-court transaction, the first-lien lenders extended only a $40.5 million bridge (the Ninth Amendment delayed-draw term loans) to fund continued negotiations and preparation for a potential chapter 11 filing.

The prepackaged filing aims to implement a comprehensive balance-sheet restructuring pursuant to a Restructuring Support Agreement (RSA) supported by Prepetition First Lien Lenders holding greater than 99% of the Prepetition Secured Loans and an ad hoc noteholder group holding greater than 85% of the second-lien PIK Notes and greater than 80% of the unsecured convertible notes. The Plan, for which the debtors solicited and obtained confirming votes prepetition, reduces prepetition debt by approximately $325.4 million: first-lien claimholders receive the substantial majority of new equity interests and exit term loans, while PIK and convertible noteholders receive a minority equity allocation and new warrants. GUCs and the DOJ remain unimpaired, with general unsecured creditors slated for a 100% recovery.

To fund the cases, the debtors secured a senior secured superpriority DIP facility provided pro rata by the Prepetition Secured Loan lenders (Acquiom Agency Services LLC as agent), comprising $25.0 million in new money (a $16.0 million initial draw plus a $9.0 million delayed draw) and a $40.5 million roll-up of the Bridge Facility delayed-draw term loans, bearing interest at Adjusted Term SOFR plus 11.5% (2.50% floor), paid in kind, and maturing 60 days after the Petition Date subject to one 30-day extension. Upon emergence, all DIP obligations will be replaced dollar-for-dollar by exit term loans issued under a new senior secured first-lien term loan exit facility of up to $150.0 million.

Inotiv, Inc. reports $702.4 million in assets and $625.3 million in liabilities. The filing indicates that there will be funds available for distribution to unsecured creditors. The case number is 26-90601.

⁽¹⁾ For a complete list of debtor entities, see the Chapter 11 Debtors table.

Chapter 11 Debtors

Top Unsecured Claims

Key Parties

Co-bankruptcy Counsel:

• Timothy A. ("Tad") Davidson II
  Hunton Andrews Kurth LLP
  Email: taddavidson@Hunton.com

General Bankruptcy Counsel:

• Ropes & Gray LLP

Investment Banker:

• Perella Weinberg Partners

Financial Advisor:

• FTI Consulting, Inc.

Notice, Claims, Solicitation and Balloting Agent:

• Kroll Restructuring Administration LLC

Signatories:

• Robert Leasure, Jr. – President

Bondoro Insights is continuing to monitor this case and will provide further coverage as appropriate.

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