A bankruptcy judge cleared Mallinckrodt PLC of liability for allegedly charging anticompetitive prices to health insurers on its flagship product, rejecting their claims for $382 million in antitrust damages, WSJ Pro Bankruptcy reported. Judge John Dorsey of the U.S. Bankruptcy Court in Wilmington, Del., ruled yesterday that Humana Inc. and other health insurers had failed to prove that the high price charged by Mallinckrodt for its H.P. Acthar gel product after its chapter 11 filing last year stemmed from ongoing anticompetitive conduct. As a result, the insurers aren’t entitled to the $382 million in top-ranking administrative claims they had brought against Mallinckrodt in its chapter 11 proceedings, Judge Dorsey said. Humana and others had sued Mallinckrodt before its bankruptcy over price increases for Acthar, which is used to treat infantile spasms, multiple sclerosis and other ailments and costs roughly $38,000 a vial, up from about $50 in 2001. The insurer argued the cost of any wrongdoing should continue to accrue while Mallinckrodt is in bankruptcy and be treated as administrative expenses, which must be paid in full ahead of other creditors for the company to leave chapter 11. Humana has said it continues to pay about $7.5 million every month for the drug, a price it alleged is inflated by anticompetitive conduct.
