October 24, 2019 / 12:43 PM / 19 days ago

Baxter named in opioid complaint, reveals internal accounting probe

(Reuters) - Medical supply company Baxter International Inc said it was named in a complaint for improperly marketing opioid drugs and revealed an internal probe into its accounting on Thursday, sending its shares down 10%.

Baxter, which also makes generic drugs, said in a filing it was served in August with the amended complaint filed by Fayette County in the multi-district litigation pending in U.S. District Court, Northern District of Ohio. (bit.ly/31F5Zy1)

The drugmaker said it made injectable generic opioid drugs in its facility in New Jersey, which was divested in 2011.

Separately, Baxter also announced an internal investigation into misstatements reported in its financial statements from 2014-2018 and the first half of 2019.

Baxter, which also reported preliminary third-quarter earnings on Thursday, said it may have to amend its previous reports when the investigation is completed or include restated financial statements in future reports.

The company said the investigation is around certain intra-company transactions, which used a foreign exchange rate that was not in accordance with generally accepted accounting principles.

“Although we recognize the concern sparked by any need for restated financials, the core matter here relates to non-operating income and thus looks fairly benign based on what we now know,” said Cowen analyst Joshua Jennings.

Shares of the company fell 10.2% to $79 in early trading.

Reporting by Manas Mishra in Bengaluru; Editing by Shinjini Ganguli

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