Mallinckrodt ARD, Inc.

January 19, 2017 By Alex Keown , BioSpace.com Breaking News Staff NEW YORK – Mallinckrodt ARD Inc. will pay $100 million to settle federal complaints the company violated antitrust laws after acquiring the rights to a drug that “threatened its monopoly in the U.S. market for adrenocorticotropic hormone (ACTH) drugs.” The Federal Trade Commission said that Mallinckrodt benefited from an existing monopoly for its ACTH drug, Acthar, a specialty drug used to treat seizures and spasms in infants. According to the complaint, Mallinckrodt “illegally acquired the U.S. rights to develop a competing drug, Synacthen Depot,” which stifled competition. Mallinckrodt acquired Synacthen from Novartis . The FTC said other companies were prevented from using the Synacthen assets to develop a synthetic ACTH drug and allowed Mallinckrodt to maintain “extremely high prices for Acthar.” According to the complaint, Acthar treatment for an infant with infantile spasms can cost more than $100,000. “Questcor took advantage of its monopoly to repeatedly raise the price of Acthar, from $40 per vial in 2001 to more than $34,000 per vial today—an 85,000 percent increase,” FTC Chairwoman Edith Ramirez said in a statement. “We charge that, to maintain its monopoly pricing, it acquired the rights to its greatest competitive threat, a synthetic version of Acthar, to forestall future competition. This is precisely the kind of conduct the antitrust laws prohibit.” In a statement on its website, Mallinckrodt said it has cooperated fully with the FTC regarding Synacthen. “We are pleased with the agreement reached to resolve this legacy matter, although we continue to strongly disagree with allegations outlined in the FTC’s complaint, believing that key claims are unsupported and even contradicted by scientific data and market facts, and appear to be inconsistent with the views of the FDA,” a Mallinckrodt spokesperson said in the statement. Mallinckrodt said it currently derives no U.S. revenue from Synacthen Depot and the resolution of this matter will not impact Mallinckrodt’s net sales. Interestingly, in a pot calling the kettle black scenario, the company has been under FTC investigation since 2014 after Martin Shkreli filed a lawsuit against Mallinckrodt in 2014 for its practices. The lawsuit was filed while Shkreli helmed Retrophin. CNBC reported that Retrophin had bid on Synacthen, but was outbid by Mallinckrodt. In the complaint, Retrophin said Mallinckrodt wanted to shut down any drug that could compete with Acthar. Retrophin settled its case against Questcor (now Mallinckrodt) in 2015 after Questcor paid Retrophin $15.5 million, CNBC reported. Shortly after Retrophin was paid, the company terminated Shkreli for mismanagement of funds. Shkreli was later condemned for the price hike of the 65-year-old Daraprim—a decision he roundly defended, even suggesting he could have increased the price even more. Shkreli is currently awaiting trial for multiple charges of federal securities trade fraud. He is scheduled to go before a judge on June 26, 2017. Although a lightning rod of criticism during his time helming Turing Pharmaceuticals and the Daraprim price hike, Shkreli was ultimately brought down from his time spent as a hedge fund manager. Shkreli was charged by federal authorities on Dec. 17. The seven count indictment against Shkreli included multiple charges of securities fraud, securities fraud conspiracy and wire fraud conspiracy.