Mallinckrodt PLC (NYSE: MNK) is having an overwhelmingly rough day in the market today, and for good reason. Citron research has waged an attack against the company, leading to fear among investors and prompting our partners at Trade Ideas to alert us to the movement. At the moment (10:34), MNK is trading at $39.25 per share after a loss of $3.40 per share (7.97%) thus far today.
Citron Attacks MNK
As mentioned above, Mallinckrodt is having a rough day in the market today after Citron Research waged an attack against the company. Comparing Mallinckrodt and Express Scripts (ESRX) to Valeant Pharmaceuticals (VRX) and Philidor, Citron is accusing MNK of price gauging.
The report claims that while Express Scripts was designed to protect the healthcare system from price gauging, it’s actually taking part in the act with Acthar by MNK. With the report, ESRX seems to be throwing Mallinckrodt under the bus. In the report, Citron points to direct quotes from Express Scripts executives. Here are some of the statements that were offered:
“I don’t think it’s a very great – it’s a pretty poor drug with a very limited need and certainly Steve could comment… Completely, you know, and steve, you could chime in here too, but I think Steve and I both would agree, and I think everybody in our company would agree, that the product is vastly overpriced for the value… I personally told their management team their drug is hugely overpriced. I know Steve has as well…” – Everett Neville, SVP Supply Chain and Specialty Pharma ESRX.
“If you look at the data, the indications for the drug are really – while it had, in the compendium, it’s listed under a lot of indications, its real use should be very, very limited. ITS AN OLD DRUG. THERE’S BETTER PRODUCTS IN THE MARKETPLACE and so we’re going to continue to be very vigilant in our utilization management.” – Dr. Steve Miller, SVP Supply Chain and Specialty Pharma ESRX.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will be keeping a close eye on MNK and the ongoing scandal surrounding price gauging. Of course, we’ll continue to keep you updated as the story breaks!
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