Mallinckrodt PLC has begun defending its chapter 11 exit plan, a proposal that would reduce its debt and settle litigation the company faces over its production of opioids for roughly $1.72 billion, WSJ Pro Bankruptcy reported. A trial addressing the drugmaker’s chapter 11 reorganization plan opened Monday in the U.S. Bankruptcy Court in Wilmington, Del. Mallinckrodt sought court protection early last year with the framework of a deal already in hand to resolve its opioid liabilities. The trial could last several weeks. Financial advisers hired by Mallinckrodt were questioned yesterday about business projections and other metrics underpinning the restructuring plan. The value of the company once it leaves chapter 11 is projected to be between about $5.2 billion and $5.7 billion, court papers say. Dublin-based Mallinckrodt is among a handful of drugmakers that turned to bankruptcy recently to resolve a deluge of lawsuits over the opioid epidemic. As with other drugmakers that have sought chapter 11, settlement funds would be used to combat opioid addiction, which increased during the COVID-19 pandemic. Mallinckrodt is also seeking to settle liability over pricing for its H.P. Acthar Gel drug, which costs roughly $38,000 a vial and is used treat infantile spasms, multiple sclerosis and other conditions.
