Medly Health is now in Chapter 7 estate administration, with the trustee recently resolving a FedEx preference dispute through a court-approved Rule 9019 settlement and the May 15, 2026 hearing cancelled after the matter went uncontested. The case began as a Delaware chapter 11 filing on December 9, 2022, when Medly and affiliates sought protection after a liquidity collapse at a multi-state pharmacy platform that had combined digital prescription delivery with the Pharmaca health-and-wellness pharmacy chain through the Voluntary PetitionDkt. 1.
The filing followed a rapid deterioration in funding and operations. Medly entered the case with a secured debt stack that included Silicon Valley Bank’s $20 million first-priority facility, TriplePoint Capital debt, and secured notes, while the Willis declaration described persistent operating losses, MidCap’s withdrawal of a contemplated $100 million financing commitment, loss of expected equity support, founder-related operational and accounting issues, an 80% sales decline, inability to purchase drugs for several weeks, store closures, and a large workforce reduction. The chapter 11 strategy was not a balance-sheet recapitalization; it was an asset-disposition case built around selling prescription lists from the remaining Medly pharmacies and pursuing a going-concern sale of Pharmaca, supported by first-day relief and DIP financing to fund administration through the Willis First Day DeclarationDkt. 3.
The current docket reflects post-conversion liquidation work rather than an operating restructuring. On April 24, 2026, the Chapter 7 trustee sought approval of a settlement with Federal Express Corporation to resolve potential avoidance claims tied to at least $1.18 million of alleged preference-period transfers, with FedEx to pay $35,000 and waive any section 502(h) claim arising from the settlement payment under the . No objection was filed by the May 8 deadline, the trustee certified the absence of opposition through the , and the court approved the compromise on May 14 through the .
With that order entered, the only noticed May 15 matter fell away and the trustee cancelled the hearing through the Cancelled Hearing AgendaDkt. 855. The case posture is therefore a liquidating Chapter 7 estate collecting and resolving residual claims, not a pending sale or plan confirmation process; the near-term docket milestone identified in the context pack has already been resolved.
