The company will split into two divisions.
Mallinckrodt has been investigating a potential future for its specialty generics business for nearly two years. A decision has finally been made: the business will be spun off. Following the spinoff, there will be two publicly traded companies.
The generic business will retain the Mallinckrodt name and stock ticker on the New York Stock Exchange and be located in St. Louis. It will be responsible for drugs with total net sales of $850 million, including the branded constipation drug Amitiza (lubiprostone). It will also take on the active pharmaceutical ingredient manufacturing business and responsibility for ongoing opioid litigation. Mallinckrodt has been named in 1,275 lawsuits that either were rolled into or are expected to be transferred into a multidistrict litigation established in December 2017.
The branded specialty pharma business will take on a new name and be responsible for approximately 70% of the current company’s drug portfolio, which has total net sales of approximately $2.4 billion. Of particular interest is H.P. Acthar Gel (repository corticotropin injection), which accounted for nearly half of the company’s net sales through the first three quarters of 2018. The drug is currently in clinical trials for rheumatoid arthritis and multiple sclerosis, with results expected in the first half of 2019. Three additional clinical studies for Acthar are currently enrolling, including phase IV studies in uveitis and lupus and a phase II study in amyotrophic lateral sclerosis (ALS).
The spinoff is expected to take place in 2019 following final approval by the board.