- Mallinckrodt is handing over $35 million to settle federal investigations of its manufacturing and monitoring procedures, the company reported earlier this week.
- The St. Louis-based drugmaker is one of the nation's largest developers of prescription opioids. By late 2011, it found itself under the magnifying glass of the Drug Enforcement Administration, which ultimately claimed Mallinckrodt "failed to report suspicious orders of controlled substances during the period 2006-2011," according to the company's last annual filing.
- "The company denies government allegations that it violated applicable laws in connection with its suspicious order monitoring program, and the settlement contains no admission of liability for civil penalties for relevant conduct," Mallinckrodt said in an April 3 statement. "In discussions with the government, the company has responded to unfounded claims and successfully refuted factual inaccuracies — reaching an agreement in principle that is agreeable to the government in light of the facts of the matter."
While the settlement ends another chapter in the contentious relationship between the drugmaker and government regulators, the saga is likely far from over.
Just a few months back, the company reached a settlement related to allegations lobbed by the Federal Trade Commission about the pricing of Acthar Gel (repository corticotropin injection) — a medication with a variety of indications, including multiple sclerosis and lupus. The drug's price tag had grown about 85,000% over a 16-year period, and the FTC wanted answers. Mallinckrodt, not admitting wrongdoing, agreed to pay $100 million in fines to close the investigation.
The big pharma has also wrestled with the Food and Drug Administration, suing the agency following a request for additional data on the bioequivalence of the company's generic to Johnson & Johnson's Concerta (methylphenidate HCI). The lawsuit, filed in the fall of 2014, claimed the FDA didn't have the authority to require such data and didn't give adequate time to respond to its requests.
The lawsuit fizzled in 2015, and Mallinckrodt only recently decided to submit additional evidence to the agency. The fact that its product has stayed on the market for years without that data, however, underscores the limitations of federal officials.
Opioid manufacturers, particularly those as large as Mallinckrodt, have become lightning rods for controversy and audits as the U.S. battles spiking levels of painkiller abuse and heroin overdose. Last week, Senator Claire McCaskill, D-Mo., and the Senate Homeland Security and Governmental Affairs Committee launched an investigation into five pharmaceutical companies that make prescription opioids. Mallinckrodt wasn't included in the list.
The company has taken steps to show it's in the fight for responsible prescription painkiller use. In October, it revealed plans to provide more than 60,000 drug deactivation pouches to West Virginia, one of the states most disproportionately affected by the epidemic.
Still, it will be hard to distance itself from the revenues. Hydrocodone and oxycodone sales dropped 12.4% and 18.4% in 2016, respectively, yet still totaled nearly $275 million, according to the company's most recent 10-K filing with the Securities and Exchange Commission.