In June of last year, after Mallinckrodt Pharmaceuticals emerged from a Chapter 11 reorganization and agreed to a $1.7 billion settlement to resolve opioid claims, the troubled company trumpeted its “new beginning.”
“We emerge well-positioned for long-term success, with a substantially stronger capital structure,” Paul Bisaro, Mallinckrodt’s chairman, added in a press release.
But 13 months later, the company is back in desperate straits. In regulatory filings, Mallinckrodt has admitted its failure to make its annual $200 million opioid settlement payment and suggested that bankruptcy again is in the offing.
And last week, its investors piled on, filing a class-action lawsuit against the company. In federal court in New Jersey, the investors accused Mallinckrodt of making false and misleading statements about the financial health of the company.
The plaintiffs filed the lawsuit on behalf of anyone who acquired Mallinckrodt securities between June 17, 2022, and June 14 of this year. The lawsuit accuses three company leaders—CEO Siggi Olafsson, Chief Financial Officer Bryan Reasons and Bisaro—of misleading investors. A court summons requires them to appear in court within 21 days.
In accusing the company of painting an incorrect picture of its financial status, the plaintiffs cite conference calls, press releases, quarterly earnings reports and regulatory filings with the Securities and Exchange Commission.
On June 2 of this year, when The Wall Street Journal reported that...
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