Company will retain the constipation treatment Amitiza.
Mallinckrodt expects to complete the spinout of its specialty generics business by mid-2019. The new company will have a portfolio of specialty generics and active pharmaceutical ingredients, employ 1600, and take the name Mallinckrodt as well as the MNK symbol on the New York Stock Exchange (NYSE). The specialty brands company that remains will take the name Sonorant Therapeutics and the SRTX ticker on the NYSE.
The spinout will have a somewhat different form than originally planned. Sonorant Therapeutics has retained Amitiza (lubiprostone), a constipation treatment, in the hopes that sales from this product will counteract anticipated losses in revenue from its Acthar Gel (corticotropin) for the treatment of arthritis and other conditions following a U.S. rebate decision.
However, the support from Amitiza will likely be short-lived, as the drug is facing the end of patent protection and expected generic competition starting in 2021. The company’s drug Ofirmev (acetaminophen for injection) will also be fighting generic competition beginning in 2021.
Before the spinoff, Mallinckrodt also said the specialty generics business would raise up to $300 million in debt, with net proceeds going to the parent company. Even so, Mallinckrodt CEO Mark Trudeau indicated that the new company would have less debt than originally expected.