PlanetRx.com on Verge of Bankruptcy, Faces Lawsuits
Online pharmacy PlanetRx.com announced plans last month to liquidate its assets and dissolve the company, and it is facing at least three shareholder lawsuits "alleging a violation of federal securities laws," the Memphis Commercial Appeal reports. The company's board is expected to approve the liquidation plan this month, and shareholders are expected to vote on the plan in June. In March, Comdisco, an Illinois-based creditor, "notified PlanetRx.com that it was in default of its $7 million loan," an action that could put the company in bankruptcy. The Commercial Appeal reports that Memphis-based PlanetRx.com, which was launched in 1999 and was valued at $116.7 million at the end of that year, "has been transformed from an online pharmacy to an off-line legal case." According to the company's latest annual report filed with the Securities and Exchange Commission, PlanetRx.com's "remaining employees are engaged full-time in preserving the company's assets and defending it against lawsuits" (Watson, Memphis Commercial Appeal, 4/19). PlanetRx.com officially closed its store on March 12 and is now sending its customers to drugstore.com (PlanetRx.com Web site).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.