Scarsin Files NOI Amid Liquidity Crisis; Court Approves $400K Insider DIP and Stay Extension

Scarsin Corporation, an Ontario-based developer of forecasting software for the life sciences and public health sectors, has filed a Notice of Intention to Make a Proposal under the Bankruptcy and Insolvency Act and secured approval for an insider-funded DIP loan to stabilize operations.

The company filed its NOI on September 25, 2025, with KPMG Inc. appointed as Proposal Trustee. The move followed a September 16, 2025 demand and notice of intention to enforce security (NITES) issued by Royal Bank of Canada, Scarsin’s senior secured creditor. RBC was owed $192,859.25 under credit facilities originally advanced in 2013 and 2024.

Founded in 2002, Scarsin builds software-as-a-service forecasting platforms for global clients including Johnson & Johnson and Gilead, with current SaaS contracts running through December 2025. The company gained national attention during the COVID-19 pandemic for developing a public health forecasting platform supporting the Public Health Agency of Canada and Health Canada, funded internally at a cost exceeding $1.5 million.

Scarsin’s liquidity crisis deepened through 2024 and 2025 amid declining cash reserves, unprofitable operations, and an unsuccessful investor campaign to fund its AI-driven “Amaith” forecasting solution. The company posted a $1.8 million operating loss in 2024 and a further $69,000 loss for the eight months ended August 31, 2025. Its balance sheet at August 31 showed assets of $111,757 against liabilities of $14.2 million, including $743,030 in current liabilities.

To preserve operations and maintain key contracts, Scarsin sought debtor-in-possession financing of up to $400,000 from its sole director and president, Paul Minshull, who is also a secured creditor. The DIP facility carries 12% annual interest and is secured by a court-ordered super-priority charge ranking behind only a $145,000 Administration Charge in favour of KPMG and counsel.

In her October 9, 2025 endorsement, Justice Conway of the Ontario Superior Court (Commercial List) approved the DIP and extended Scarsin’s time to file a proposal to December 9, 2025. The Court accepted evidence that without interim funding, the company would be unable to make payroll or continue servicing client contracts.

Scarsin’s other secured creditors include Dell Financial Services Canada Limited (equipment leases) and Citibank Europe plc (accounts receivable under a Johnson & Johnson supplier agreement). The company employs eight full-time staff and owes approximately $300,000 in source deductions.

KPMG is the proposal trustee. Counsel is Miller Thomson for Scarsin, Loopstra Nixon for the proposal trustee and Gowling WLG for RBC.