Falling Behind in a Fast-Moving Market
Founded in 1981 and once acquired by Johnson & Johnson in 1986, LifeScan was later spun off in a $2.1 billion deal to Platinum Equity in 2018. The company built its reputation with fingerstick-based blood sugar monitors—but the rise of CGM systems like Abbott’s FreeStyle Libre and Dexcom’s G7 has left LifeScan trailing behind.
Asbury cited delays with a development partner on a proprietary CGM product as a key reason for the company’s cash squeeze. Meanwhile, burdensome rebate agreements with pharmacy benefit managers and Medicaid entities have taken a toll on margins.
Inside the Restructuring Plan: Creditors, Equity, and Auctions
Under the proposed restructuring:
-
First-lien lenders would receive new debt and an option to acquire up to 20% equity in the reorganized entity.
-
Second-lien lenders would receive the majority of ownership.
-
Unsecured creditors would split a $10 million cash pool.
-
LifeScan would test the market for bids through a court-supervised auction process.
If no superior bids emerge, the company will proceed with its lender-backed plan and hopes to gain confirmation by late September.
