Mallinckrodt Plc CFO Bryan Reasons said that the company may be set up in a way that allows for a “unique” settlement to resolve opioid suits, echoing previous comments about spinning off its Specialty Generics business where the legal exposure could be contained, Bloomberg News reported. “We feel like we potentially have a structure for a settlement, might be a little bit unique to our legal entity structure,” Reasons said on Nov. 20. The CFO made similar comments at a June conference where he stated his confidence that the opioid litigation risk was limited to Mallinckrodt’s Specialty Generics business. The company had stated plans earlier in 2019 to spin off the unit for a sale, but suspended that process as liabilities mounted. “A full chapter 11 filing is unlikely to be the anchor part of any plan for which management is pushing,” BI analyst Mike Holland said. But putting only the specialty generics business into bankruptcy protection, “would be a goal, in my view.” Alternatively, Holland said, some interpret the CFO’s statements as possibly referring to a plan to spin off and place the specialty generics unit, in combination with some cash, in a trust to comprise a settlement consideration.
