Shares of drugmaker Mallinckrodt (MNK) - Get Report plunged on Thursday on a report that the company was considering filing for bankruptcy as a way of dealing with its opioid-related legal liabilities.
Mallinckrodt stock was down more than 41% to $1.52 a share in early trading on Thursday after Bloomberg reported that the company was mulling bankruptcy to deal with $15 million in opioid-related claims against its Questcor unit.
Specifically, Mallinckrodt in June cut a deal with the Department of Justice to resolve claims that sales representatives for the company's Questcor unit paid illegal kickbacks to doctors - in the form of lavish dinners and entertainment - to write prescriptions of the company's drug, H.P. Acthar Gel (Acthar), from 2009 to 2013.
The company is already facing $5 billion in debt, according to Bloomberg.
Botox maker Allergan (AGN) - Get Report at the end of August announced it had reached a settlement with two plaintiffs in Ohio in multi-district federal litigation over opioids. As part of that agreement, Allergan will pay $1.9 million to Summit County, Ohio, and $3.1 million to Cuyahoga County, Ohio.