Drugmakers Mallinckrodt and Endo have today completed their near $7 billion merger deal, which was first announced in March.
Under the terms of the deal, Endo shareholders got $100m in cash and now own 49.9% of the combined company, while Mallinckrodt shareholders own the rest for an enterprise value of $6.7 billion.
The combined company will be listed on the New York Stock Exchange and sell branded drugs such as Mallinckrodt’s Acthar gel and kidney disease therapy Terlivaz as well as Endo’s testosterone injection Aveed.
The drugmakers will also combine their generic pharmaceuticals businesses and Endo’s sterile injectables business after the close of the deal. They intend to separate that business from the combined company at a later date.
Endo will become a wholly-owned subsidiary of Mallinckrodt, with Mallinckrodt CEO Siggi Olafsson serving as CEO of the combined company.
Paul Efron, formerly a member of the Endo Board of Directors, will serve as Board Chair of Mallinckrodt.
The company’s board has nine directors – four from Mallinckrodt’s board prior to the merger, including Mr Olafsson, four from Endo’s board prior to the merger, including M. Efron, and one jointly selected new director who will be announced shortly.
Both companies have in recent years emerged from bankruptcies and lawsuits related to their alleged role in the US opioid epidemic.
Dublin-based Mallinckrodt went bankrupt twice – once in 2020 due to its high debt load and litigation over its allegedly deceptive marketing of highly addictive generic opioids; and again in 2023 due to declining sales of its key branded drugs, including Acthar Gel.
As part of its second restructuring, Mallinckrodt was able to trim $1 billion from its previously agreed upon opioid settlement that resolved about 3,000 lawsuits.
Endo filed for bankruptcy in 2022 and completed its financial restructuring last year.
“We are excited to pursue a promising new future for all the stakeholders of Mallinckrodt and Endo,” said Siggi Olafsson, President and CEO of the combined company.
“Today we bring together two highly complementary companies with durable, on-market products in our branded portfolio and best-in-class capabilities across the value chain in our generics and sterile injectables business, which we call Par Health,” the CEO said.
“We have a strong balance sheet and meaningful financial flexibility to invest in innovation and business development to drive growth. As a company deeply committed to operating with integrity and purpose, we are focused on delivering significant value to shareholders and employees for the ultimate benefit of the patients we serve,” he added.
