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Mallinckrodt: New Policy Change Presents An Opportunity
- The FDA is reclassifying Mallinckrodt's Concerta generic drug from AB to BX - not automatically interchangeable at pharmacies.
- This came as a surprise to Mallinckrodt and it will need to revise guidance.
- I believe that this is a small and "uncertain" setback in the grand scheme of its overall growth goals going into 2015.
- Any bump in the road presents an opportunity in this fundamentally strong company.
Hydrocodone-Acetaminophen (APAP) Products Promises Even More Revenue For MallinckrodtClinically Sound Investor • Nov. 4, 2014
- Last week, manufacturers across-the-board started charging triple for the popular pain killer combination of narcotic and 325 mg generic Tylenol.
- Sales declined for Mallinckrodt as it was forced to discontinue all of its products with higher amounts of liver-toxic APAP at the beginning of the year.
- Increased U.S. revenue will be reflected at next quarter's report, and could add up to $50 million to the bottom line.
Mallinckrodt Is The Little-Known Pharma Stock You Should Keep On Your Radar
- It appears to me that the stock is undervalued with respect to 2015 earnings estimates.
- Though I calculate a good reward/risk ratio, the bearish momentum in the name will probably take it down before it goes up.
- This former spinoff from Covidien is a winner as it is up 105% in the last year!
Dropping Oil Prices Made Me Drop Nabors In Favor Of Safety Growth Stock Mallinckrodt
- I was once very heavy in the oil complex for the growth portfolio, but since it started to decline I've been closing my positions in great names such as Nabors.
- Mallinckrodt will provide me safety as it is in the healthcare industry and is even in the safety portion of the safety sector by being in generics.
- I believe the Questcor acquisition that Mallinckrodt made recently is what propelled it to be a growth stock.
Update: Questcor Shareholders Are The Net Gainers Of Acquisition Deal
- Mallinckrodt has completed the acquisition of Questcor Pharmaceuticals.
- As we expected, the deal went through without any troubles as the deal was beneficial for both sets of shareholders.
- It has further proved our point of view that the Questcor shareholders will be the major gainers from this deal.
Mallinckrodt's CEO Could Be Leading His Shareholders To The Slaughter
- It's looking like the QCOR/MNK merger is going to happen, regardless of concerns raised by many about Questcor's Acthar Gel.
- While I believe this to be foolish on MNK's part, it's going to make MNK an attractive short going forward.
- I'd love to show Mark Trudeau that while profits are extremely important, ignoring regulatory risk and serious concerns surrounding Acthar could prove to be even more important going forward.
- I wrote last week that Questcor seemed to "lie by omission" in their proxy by not disclosing their massive drop in Tricare numbers - no one seemed to care.
- Like a Penn & Teller show, we have the old misdirection act going on; everyone at MNK is so focused on EPS gains, they're ignoring blatant risks and regulatory concerns.
- Two significant events just occurred for Mallinckrodt this week.
- A key patent challenge was settled, removing a stock overhang.
- A strong quarter “beat” was reported on Thursday.
- Wall Street stock targets are raised, possibly due to its forward P/E multiple which is very attractive.
Questcor Seems To Lie By Omission To The SEC, Aetna National Medical Director Slams Acthar
- Tricare numbers for Acthar have fallen off a cliff, from 725 in 2013 to less than 100 for the first 5 months of 2014, according to ProPublica.
- In QCOR's amended proxy risk factors filed on Form 425 July 10th, the company states the policy change "MAY" affect Tricare numbers that seem to have already tanked months ago.
- If ProPublica article's FOIA numbers are correct, why wouldn't the company not just come out and simply say the numbers have already tanked - does Mallinckrodt and the SEC know?
- How do Mallinckrodt and their shareholders look at these facts and possibly go forward with the buyout?
- National Medical Director of Drug Policy for Aetna confirms at insurance conference they're "hopeful of no Acthar use outside of IS".
Questcor Ate The Steak, Mallinckrodt Likely To Foot The Bill
- The Questcor/Mallinckrodt merger seems to be pushing forward, day by day, despite the enormous risk Mallinckrodt appears to be taking on.
- David Einhorn, in his Greenlight letter Friday, stated he was short Questcor - for exactly the same reasons that people like QTR/Citron and Whitney Tilson are skeptics of the company.
- If the merger goes through, Mallinckrodt could be a massive short opportunity. If not, Questcor is a tasty short in and of itself.
- QTR has immense respect for David Einhorn and his work, and thinks the market needs to pay damn close attention to what he just said about Questcor.
- QTR thinks we have not heard the last of this story and anticipates looking back on this one in years and wondering how it wasn't clearer to everyone.
Acthar's Future Could Be An Adverse Event For Mallinckrodt
- Recent revelations demonstrate that QCOR's drug Acthar was administered to patients who suffered hundreds of adverse events and several deaths.
- Adverse events related to Acthar occur predominately in NS patients. A real safety study is needed as no large-scale study on NS patients has ever been performed.
- QCOR's clinical trial results to-date leave much to be desired. Efficacy and safety are questionable. This may become a serious issue for MNK post-merger.
- The merger is likely to be completed in August, as the companies have mailed the proxy document.
- The costs will be substantial for both companies if the merger falls through.
- The combined entity will be a better prospect, as it will give Questcor larger scale and Mallinckrodt will get a lucrative product.
- Mallinckrodt plc's purchase of Questcor adds significant leverage to combined entity.
- Mallinckrodt is betting future of the company on suspect marketing of previously financially unsuccessful drug.
- Questcor shareholders are being de-risked due to $30 per share cash component of the deal.
Questcor's Own Data Blatantly Shows A 31% Decline In Net Sales Of Acthar By Aetna, With Other Insurers Following Suit - Mallinckrodt Shareholders, Pay Attention
- Let's ignore the fact that Questcor is facing an ongoing active U.S. Government investigation, is pushing a suspect drug and has seen insiders cash out hundreds of millions.
- What Mallinckrodt and its shareholders need to see is the astonishing effect that Aetna's coverage limitation has had on Acthar from 2012 to 2013 - a MASSIVE 31% decline.
- From that, MNK and its shareholders must extrapolate that same data from UnitedHealth - who makes up 11% of Acthar's total net sales - they've implemented same policy as Aetna.
- Cigna's Acthar net sales are also down 13.6%, per Questcor's own disclosure, year-over year as they implement the same drug policy.
- This is a disgustingly demonstrable risk for Mallinckrodt to get involved with Acthar - as namely ALL major insurance companies DO NOT cover it for any indication other than IS.
Questcor Comes Clean On Acthar; NY Times Seems To Confirm FDA Interest
- Questcor disclosed adverse events to Acthar as was found in the FDA's FAERS system by the NY Times.
- This amendment could have been what was holding up the merger proxy; we'll have to wait and see.
- The FDA seems to continue to backhandedly confirm that there is an ongoing review of Questcor's Acthar at the agency.
- Fantastic reporting done by Gretchen Morgenson at the NY Times.
Questcor's Acthar: Refuting A Long's Optimism With Irrefutable Facts
- Two respected investors have come to me asking about when Questcor/MNK's proxy is going to be finished.
- Questcor's Acthar is under major scrutiny from UnitedHealth, who proclaimed it "not medically necessary" for 4 of its 5 last indications.
- Article was out this morning blindly supporting Acthar sans clinical trials, data, and zero knowledge of how Citron performed their testing.
- Much of what I've heard from longs, Questcor and Mallinckrodt alike is that they assume Citron's research was done incorrectly.
- Which means if Citron's results were correct and done properly - which I contend they were - there's still quite a bit on the table to have pause about.
Questcor's Acthar Gel: Clinical Usage Suggests Efficacy
- The increasing usage of Acthar Gel implies positive clinical outcomes.
- The common ethical framework of end justifies the means to attain insurance coverage conceals efficacy.
- The allegation of missing active ingredient lacks credibility.
- The phase II FDA consideration for Acthar Gel has potential to reduce mortality.
Questcor And Mallinckrodt: The Good, The Bad, And The Ugly
- Questcor Pharmaceuticals, Inc. will begin trading ex-dividend on June 27, 2014. A cash dividend payment of $0.3 per share is scheduled to be paid on July 08.
- Mallinckrodt will acquire Questcor in Q3. Questcor shareholders will receive $30.00 per share in cash and 0.897 Mallinckrodt shares for each share of Questcor common stock.
- Short interest for QCOR as of 6/13/2014 is 19,245,387 shares. 35.45% of the float is astonishing given a dividend, merger, and clinical trials. QCOR pps is still increasing.
- Short interest for MNK as of 6/13/2014 is 15,904,480 shares. 32.89% of the float is unusual, as both companies approach a merger. MNK pps is still increasing.
- QCOR short interest is increasing commensurate with pps for the last 4 months, and this is not a sustainable trend for short sellers to continue given future catalysts.
Hey Mallinckrodt, Pay Close Attention - UnitedHealth Just Slammed Questcor's Acthar
- 4 out of the top 5 indications for Acthar use look to be in jeopardy of not being covered and/or taken seriously by UnitedHealth; Cigna also expressed doubts weeks ago.
- UnitedHealth is one of the biggest medical insurance companies on the face of the planet - this news is a massive deal that could prompt other insurers to do the same.
- Aside from questions about efficacy in MS, nephrotic syndrome, et al, there still remains major unanswered questions about the drug's chemical makeup.
- Questcor lacks the "robust" clinical trials necessary to establish efficacy for almost all of the indications that Acthar is being used for.
- The $8 billion question - where is the FDA on all of this?
- It is now going on six months since Citron's allegations of Questcor selling a diluted, incorrectly labeled drug surfaced.
- The FDA has been noted by the NY Times as "reviewing the allegations that the Acthar label did not accurately reflect the drug’s ingredients".
- Individual inquires over the past month to the FDA have also resulted in hearing that this issue is "under review" and "ongoing".
- The FDA owes the public, Acthar users, insurance companies, Mallinckrodt shareholders and even Questcor shareholders a definitive response as to what measures it is taking (if any) here.
- Additionally, due to the severity of the allegations, the FDA owes us an eventual response as to whether or not Citron's claims hold merit or are meaningless.
- Questcor shorts "lost" when the company announced its proposed merger with MNK and the stock rocketed.
- It was then "all quiet on the Western front" for a little while, until a recent note from Cigna seemed to once again question the efficacy of Questcor's Acthar.
- Following that note, the NY Times penned a skeptical piece questioning some of the potential adverse effects of Acthar that have been reported to the FDA.
- A FOIA request provided the FAERS documentation, as well as Citron's original 31 page letter to the FDA inclusive of their professional lab findings, both linked within.
- The DOJ continues to have an ongoing investigation into QCOR's promotional tactics for Acthar, leaving QTR still skeptical of QCOR, despite not having a position for the time being.
Today, 1:13 PM
- Palo Alto, CA-based Carbylan Therapeutics (Pending:CBYL) is set for its IPO of 5.8M shares of common stock at $12 - 14. Underwriters over-allotment is an additional 870K shares.
- The clinical stage specialty pharmaceutical firm develops novel and combination therapies that address significant unmet medical needs. The technological basis for its products is a methodology that cross-links hyaluronic acid to form hydrogels. Alterations in the formula enable the formation of hydrogels in a wide range of textures, from soft to hard. Biologically-active agents can be directly incorporated into the gels, which can be applied topically or parenterally.
- Its lead product candidate is Hydros-TA, currently in Phase 3 development, an injectable therapy to treat the pain associated with osteoarthritis of the knee. The company expects to submit a New Drug Application (NDA) to the FDA for this indication in early 2017.
- Net losses for 2014 (9 mo.) and 2013 were $8.6M and $5.7M, respectively.
- OA-related tickers: (NASDAQ:HZNP) (OTCPK:NRIFF) (NASDAQ:XENE) (NYSEMKT:AMPE) (NASDAQ:FLXN) (NASDAQ:ANIK) (NYSE:MNK)
Fri, Jan. 23, 1:42 PM
- The Board of Directors of Mallinckrodt (MNK +1.5%) approves an open-ended $300M share repurchase program.
- CEO Mark Trudeau says, "Funding additional initiatives and seeking attractive business development opportunities remain top priorities as we continue to pursue a range of focused growth strategies. This authorization reflects our strong financial position and commitment to a disciplined capital allocation strategy while reaffirming our confidence in the company's outlook and long-term potential. It also gives us the flexibility to execute share repurchases in a measured and opportunistic manner over time."
Dec. 25, 2014, 12:41 PM
- Endo International plc (NASDAQ:ENDP) subsidiary Endo Pharmaceuticals and BioDelivery Sciences (NASDAQ:BDSI) submit a New Drug Application (NDA) to the FDA for Buprenorphine HCl Buccal Film for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate.
- The product uses BioDelivery's BioErodible MucoAdhesive (BEMA) technology to deliver buprenorphine across the buccal mucosa (inside lining of the cheek) via a thin film that adheres to the cheek lining in less than five seconds and then completely dissolves.
- Buprenorphine is a partial mu-opioid receptor agonist and a kappa antagonist which is different than full mu-opioid agonists like morphine. It is a Schedule III controlled substance which has a lower abuse potential than Schedule II drugs.
- Opioid-related tickers: (NASDAQ:ZGNX) (NYSE:PFE) (NASDAQ:EGLT) (NASDAQ:ACUR) (NYSE:MNK) (NYSE:ABBV) (NYSE:TEVA) (NASDAQ:ALKS)
Nov. 20, 2014, 1:36 PM
- The FDA approves Purdue Pharma's Hysingla ER (hydrocodone bitartrate) for pain severe enough to require daily, around-the-clock, long-term opioid treatment for which alternative treatment options are inadequate.
- Hysingla ER incorporates abuse-deterrent properties that make the tablet difficult to crush, break or dissolve and it forms a viscous hydrogel that makes it difficult to prepare for injection.
- The agency is requiring postmarketing studies of Hysingla ER to assess the effects of its abuse-deterrent properties on the risk of abuse and the consequences of that abuse in the community. Purdue is also required to make educational programs available to healthcare professionals on now to safely prescribe ER/LA opioid analgesics in addition to medication guides and patient counseling documents.
- Opioid-related tickers: (ZGNX -0.8%)(PFE +0.2%)(EGLT +4.5%)(ACUR)(MNK +0.9%)(ABBV)(TEVA -0.1%)(ALKS +1.5%)
Nov. 19, 2014, 9:09 AM
- Mallinckrodt (MNK +0.4%) FQ4 results: Revenues: $789.3M (+44.8%); Specialty Pharmaceuticals revenue: $564.8M (+85.5%); Global Medical Imaging revenue: $213.4M (-6.8%); COGS: $388.7M (+32.6%); R&D Expense: $43.8M (+1.2%); SG&A: $280.5M (+107.0%); Operating Loss: ($356.5M) (-747.0%); Net Loss: ($352.4M) (-999%); Loss Per Share: ($4.14) (-813.8%).
- FY2014 results: Revenues: $2,540.4M (+15.2%); Specialty Pharmaceuticals revenue: $1,612.9M (+32.5%); Global Medical Imaging revenue: $881.5M (-5.8%); COGS: $1,337.3M (+13.4%); R&D Expense: $166.9M (+0.7%); SG&A: $842.1M (+38.1%); Operating Loss: ($284.1M) (-296.2%); Net Loss: ($319.3M) (-643.0%); Loss Per Share: ($4.92) (-582.4%); Quick Assets: $707.8M (+156.9%); CF Ops: $373.5M (+174.8%).
- No guidance given.
Nov. 19, 2014, 7:04 AM
Nov. 18, 2014, 5:30 PM
Nov. 13, 2014, 9:14 AM
- Mallinckrodt (NYSE:MNK) is down 8% premarket on average volume in response to the FDA's reclassification of its generic ADHD med.
- Previously: FDA downgrades classification of Mallinckrodt's ADHD med
Nov. 13, 2014, 9:10 AM
Nov. 13, 2014, 7:33 AM
- Citing its new draft guidance for determining bioequivalence of methylphenidate hydrochloride products, the FDA reclassifies Mallinckrodt's (NYSE:MNK) generic version of Janssen's (NYSE:JNJ) Concerta (methylphenidate HCL) from AB (freely substitutable at the pharmacy level) to BX (presumed to be therapeutically inequivalent).
- The draft guidance, published on November 6, has an open comment period through January 5, 2015. Nevertheless, the agency states that the change in classification would be reflected in the November 13 update of the Orange Book: Approved Drug Products with Therapeutic Equivalence Evaluations.
- Unsurprisingly, the company strongly believes its product is safe and effective when used as indicated. President & CEO Mark Trudeau says, "We believe that the FDA's actions are not supported by sound scientific evidence and not consistent with the best interests of patients. Mallinckrodt methylphenidate ER products have consistently met all quality specifications and the regulatory requirements originally defined by the FDA and in the 21 months since launch more than 88M doses of these products have been prescribed. In that time, and across all of those patient exposures, the company has received only 68 confirmed adverse events related to a lack of efficacy when the patient switched from the reference listed drug (Concerta) to the company's methylphenidate ER products. We believe that this very low reporting rate is in line with response rates recorded for patients switching between different formulations of existing products."
- Since the agency's action was not contemplated in the company's October 14 guidance announcement, it will update it once the potential impact is fully assessed. Mallinckrodt will report fiscal Q4 and full-year results on November 19 before the open.
- Methylphenidate ER was the company's top seller in Q3 in the Specialty Generics and API segment generating $54.7M in sales. This represented 16.6% of the segment's total revenue of $329.4M and 8.4% of the firm's total Q3 revenue of $653.1M.
Oct. 20, 2014, 11:51 AM
Oct. 17, 2014, 5:20 PM
- The FDA approves new labeling for Pfizer's (PFE +0.4%) Embeda (morphine sulfate and naltrexone hydrochloride) extended release capsules. The opioid analgesic is indicated for the treatment of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate.
- The new labeling describes Embeda's abuse deterrent properties, which are designed to reduce, but not totally prevent, abuse of the drug when crushed and taken orally or snorted. When crushed, the naltrexone blocks some of the euphoric effects of the morphine and can precipitate withdrawal in opioid-dependent persons.
- When swallowed intact, though, Embeda can still be abused/misused because the naltrexone will not substantially block the effects of the morphine. It is also unknown whether Embeda's abuse deterrent properties will reduce IV abuse.
- The FDA is requiring postmarketing studies to further assess the impact of the abuse-deterrent properties.
- Opioid-related tickers: (ZGNX +1.9%)(EGLT +0.2%)(ACUR +2.3%)(MNK +4.1%)(ABBV +0.9%)(TEVA -0.8%)(ALKS +2.7%)
Oct. 14, 2014, 7:19 AM
- Mallinckrodt (NYSE:MNK) provides guidance for its fiscal year ended September 25, 2015.
- Net Revenues: $3.65B - 3.75B; Specialty Pharmaceuticals revenue: $2.87B - 2.92B; Global Medical Imaging revenue: $760M - 800M; non-GAAP EPS: $6.70 - 7.20; non-GAAP effective tax rate: 20 - 23%; capex: $130M - 150M.
- A conference call is scheduled for this morning at 9:00 am ET.
Oct. 7, 2014, 8:33 AM
- Danish biopharmaceutical firm Forward Pharma A/S (NASDAQ:FWP) is set for an IPO of 9.5M American Depository Shares at $20 - 22.
- Its lead product is FP187, a proprietary formulation of dimethyl fumarate (DMF) for the treatment of multiple sclerosis (MS), about to enter Phase 3 development.
- Meaningful revenues appear far in the distance, however. Patient recruitment for FP187's Phase 3 trial will take at least 18 months and the completion of the last patient's 48-week treatment will take a total of 30 months.
- The firm's operating losses for 2013 and 1H 2014 were $9M and $7.4M, respectively.
- MS-related tickers: (NASDAQ:BIIB) (NYSE:ABBV) (NYSEMKT:SYN) (NASDAQ:CNCE) (NYSE:SNY) (NASDAQ:XNPT) (NASDAQ:INO) (NASDAQ:OPXA) (NYSE:TEVA) (NASDAQ:ALKS) (NASDAQ:RCPT) (NASDAQ:AVNR) (NASDAQ:GCVRZ) (NYSE:NVS) (NASDAQ:QCOR)
Oct. 1, 2014, 10:37 AM
- Zogenix (ZGNX +4.3%) submits a supplemental New Drug Application to the FDA for an abuse deterrent version of Zohydro ER (hydrocodone bitartrate). The new capsule formulation contains additional inactive ingredients that make the product more difficult to abuse by injection and nasal insufflation (snorting).
- The company anticipates a target action date sometime in Q1 2015. If approved, the transition to the new formulation will occur in Q2.
- Related tickers: (MNK -1%)(ACT -2%)(TEVA -0.5%)(ABBV -0.9%)(LCI -4%)(ALKS -2.4%)(PFE -1.4%)
Sep. 25, 2014, 5:35 PM
MNK vs. ETF Alternatives
Mallinckrodt PLC develops, manufactures, markets & distributes generic specialty pharmaceutical products, active pharmaceutical ingredients and diagnostic imaging agents. It operates in two segments; Specialty Pharmaceuticals & Global Medical Imaging.
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