NEW YORK, NY / ACCESSWIRE / March 24, 2017 / Pomerantz LLP announces that a class action lawsuit has been filed against Mallinckrodt plc (“Mallinckrodt” or the “Company”) (NYSE: MNK) and certain of its officers. The class action, filed in United States District Court, District of Columbia, is on behalf of a class consisting of investors who purchased or otherwise acquired Mallinckrodt securities, seeking to recover compensable damages caused by defendants’ violations of the Securities Exchange Act of 1934.
If you are a shareholder who purchased Mallinckrodt securities between November 25, 2014 and January 18, 2017, both dates inclusive, you have until March 27, 2017 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at rswilloughby@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll free, ext. 9980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
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Mallinckrodt is a public limited company organized in Ireland with its U.S. headquarters in St. Louis, Missouri. Mallinckrodt develops and produces specialty pharmaceutical products, including generic drugs and imaging agents, and has in excess of $3.3 billion in annual revenue.
On August 14, 2014, Mallinckrodt acquired Questcor Pharmaceuticals, Inc. (“Questcor”) in a $5.6 billion transaction. As a result of the acquisition, Mallinckrodt added HP Acthar Gel (“Acthar”), an injectable medication made from pigs’ pituitary glands, to its drug portfolio.
Acthar is the only approved therapeutic preparation of adrenocorticotropic hormone (“ACTH”) in the U.S., and is approved by the U.S. Food and Drug Administration (“FDA”) as a treatment for 19 different conditions, including infantile spasms, and difficult-to-treat autoimmune and inflammatory conditions.
In June 2013, Questcor had acquired the U.S. rights to market a synthetic ACTH drug, Synacthen Depot (“Synacthen”) from Novartis International AG. Although not stated at the time, Questcor’s acquisition of Synacthen was for the purpose of preventing its competitors from obtaining FDA approval for an alternative ACTH treatment, thereby maintaining its U.S. monopoly on ACTH treatments.
The Complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants made false and misleading statements and failed to disclose material adverse facts about the long-term sustainability of the Company’s monopolistic Acthar Gel (“Acthar”) revenues and the dependence of the Company’s Acthar revenues on reimbursement by Medicare and Medicaid.
On November 16, 2016, Citron Research published a report (the “Citron Report”) accusing Mallinckrodt and its Chief Executive Officer, Mark Trudeau, of downplaying the Company’s reliance on Medicare and Medicaid for Acthar revenue. According to the Citron Report, a review of information published by the Centers for Medicare and Medicaid Services indicated that Medicare and Medicaid payments collectively amounted to 61.32% of Mallinckrodt’s Acthar revenues in 2015. Following the Citron Report, Mallinckrodt’s share price fell $8.15, or 12.02%, to close at $59.65 on November 16, 2016.
On November 29, 2016, during a conference call, Trudeau advised investors “Acthar now represents a significantly greater proportion of our operating income than one-third.” On this news, Mallinckrodt’s share price fell $5.25, or 9.1%, to close at $52.42 on November 29, 2016.
On January 18, 2017, the Federal Trade Commission (“FTC”) announced that Mallinckrodt had agreed to pay $100 million in connection with a joint settlement with the FTC and several states concerning charges that the Company’s efforts to stifle competing ACTH drugs had violated U.S. antitrust laws. On news of the settlement, Mallinckrodt’s share price fell $2.89, or 5.85%, to close at $46.53 on January 18, 2017.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and Los Angeles, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.
SOURCE: Pomerantz LLP
ReleaseID: 458158