August 10, 2020 - An amended complaint was filed.
July 30, 2020 - The case was transferred to the U.S. District Court for the District of New Jersey.
July 26, 2019 - An investor in shares of Mallinckrodt plc (NYSE: MNK) filed a lawsuit in the U.S. District Court for the Southern District of New York over alleged violations of Federal Securities Laws by Mallinckrodt plc in connection with certain allegedly false and misleading statements made between February 28, 2018 and July 16, 2019.
UK based Mallinckrodt plc, together with its subsidiaries, develops, manufactures, markets, and distributes specialty pharmaceutical products and therapies in the United States, Europe, the Middle East, Africa, and internationally. Among other products, Mallinckrodt’s portfolio includes H.P. Acthar Gel (“Acthar”), an injectable drug for various indications, such as rheumatoid arthritis, multiple sclerosis, infantile spasms, systemic lupus erythematosus, polymyositis, and others. Between February 28, 2018 and July 16, 2019, Acthar was in a Phase 2B study designed to assess its efficacy and safety as an investigational treatment for amyotrophic lateral sclerosis (“ALS”).
On May 1, 2019, the Wall Street Journal published an article claiming that Questcor, acquired by Mallinckrodt in 2014, defrauded government health-care plans by illegally marketing H.P. Acthar Gel. The Company purportedly resorted to bribing doctors and their staff members. To market this expensive drug, the Company allegedly offered everything from Starbucks gift cards to free Las Vegas trips, lavish dinners, sponsored happy hours and karaoke excursions.
Then, on July 16, 2019, post-market, Mallinckrodt announced that the Company was permanently discontinuing the PENNANT Trial, assessing Acthar’s safety and efficacy as an ALS treatment. Mallinckrodt stated that it decided “to halt the trial after careful consideration of a recent recommendation by the study’s independent Data and Safety Monitoring Board” (“DSMB”), which “was based on the specific concern for pneumonia, which occurred at a higher rate in the ALS patients receiving Acthar Gel compared to those on placebo” and that “the board also mentioned other adverse events specific to this patient population.”
According to the complaint the plaintiff alleges on behalf of purchasers of Mallinckrodt plc (NYSE: MNK) common shares between February 28, 2018 and July 16, 2019, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between February 28, 2018 and July 16, 2019, the Defendants made false and/or misleading statements and/or failed to disclose that Acthar posed significant safety concerns that rendered it a non-viable treatment for ALS, that accordingly, Mallinckrodt overstated the viability of Acthar as an ALS treatment, and that as a result, the Company’s public statements were materially false and misleading at all relevant times.