A Massachusetts company with the same founders as a drug compounding company tied to a deadly meningitis outbreak will lay off nearly all its employees amid its prolonged closure for inspection.
Ameridose of Westborough, Mass. employees were notified of the layoffs Thursday.
A company spokesman says the notice affects 650 employees at Ameridose and 140 employees at its marketing and support arm. He says a small number will be retained amid an ongoing product recall.
Ameridose issued a voluntary recall on Oct. 31 of all its products in circulation following an on-site investigation by the Food and Drug Administration, after which the agency told the company it wanted improvements in Ameridose's sterility testing process.
Ameridose LLC says it hopes the layoffs will be temporary.
The company paid its employees since it voluntarily closed for inspection Oct. 10 because of problems at the New England Compounding Center pharmacy, a sister company. The meningitis outbreak has been linked to a steroid, methylprednisolone acetate, made by the New England Compounding Center (NECC), in Framingham, near Boston. A preliminary investigation of the firm found contamination in "clean" areas where drugs were prepared and other questionable sterility practices.
Regulators last week asked Ameridose to remain closed until Nov. 19.
Ameridose was founded in 2006 by Greg Conigliaro and Barry Cadden, who opened the NECC eight years earlier.
An ongoing 19-state fungal meningitis outbreak has sickened 414 people as of Nov. 7, 31 of which have died. Another 10 people have developed joint infections in areas where they received the steroid injections from the NECC.