Mallinckrodt Falls 7% On Adverse FDA News

Mallinckrodt plc MNK released a press release Thursday after it was informed by the U.S. Food and Drug Administration that the agency has reason to believe that the company’s methylphenidate hydrochloride extended-release (ER) tablets, USP (CII) may not be therapeutically equivalent to the category reference drug Concerta.

"In December 2012, Mallinckrodt launched the product as the first generic alternative to Concerta, which was first approved in August 2000. Since its launch, the company’s product has provided a cost-effective alternative to hundreds of thousands of patients suffering from attention-deficit hyperactivity disorder (ADHD)," according to the company.

The press release noted that "Mallinckrodt strongly believes its methylphenidate ER products are safe and effective when used in accordance with the approved labels."

"In the face of the agency’s precipitous decision, Mallinckrodt will continue to defend the safety and efficacy of our methylphenidate products," said Mark Trudeau, President and Chief Executive Officer of Mallinckrodt. "We are considering all of our options to persuade the agency to engage in a meaningful dialog with us regarding the science, including potential legal action."

In Mallinckrodt’s view, the FDA’s recent unilateral decision, and apparent reluctance to engage with the company in a thorough scientific discussion and evaluation of these issues, could result in a variety of negative impacts including patient anxiety and uncertainty, potential disruption to effective therapy in vulnerable patients, possible market shortages, and unfavorable changes in the economics for ADHD patients and providers. "We have expressed to the FDA our earnest desire to have a robust scientific dialog about these important issues," Trudeau concluded, "and it is our hope that this dialog will take place soon."

The stock fell 7.28 percent Thursday morning on the news and traded at $86.22.