Both Mallinckrodt and Endo have previously declared bankruptcy, linked to opioid-related lawsuits.
Endo and Mallinckrodt—two drugmakers that have run into financial rough spots in recent years—will merge in a stock and cash transaction worth $6.7 billion, the companies formally announced Thursday.
The news comes after reports of a business combination circulated on Wednesday, first reported by Bloomberg.
As per the Thursday release, Endo will be folded into Mallinckrodt, which will then continue as the holding entity for the combined companies. Post-merger, the company will be listed on the New York Stock Exchange and is projected to generate around $3.6 billion in revenue this year.
Ownership of the resulting entity will be split near-perfectly down the middle: Endo shareholders will own 49.9% of the resulting entity, while the remaining 50.1% will belong to Mallinckrodt shareholders. Siggi Olafsson, president and CEO of Mallinckrodt, will be CEO, president and board member of the merged business, while Paul Efron, currently an Endo Board member, will serve as Chair of the combined company’s Board.
The deal should close in the second half of the year, pending regulatory clearances. The companies will combine and spin off their generics businesses into a separate entity pending Board approval.
In October 2020, Mallinckrodt filed for Chapter 11 bankruptcy, which the company said would help it restructure its debt and allow it to weather “several billion dollars of otherwise unmanageable potential legal liabilities.” A few months earlier, Mallinckrodt had agreed “in principle” to a $1.6 billion settlement for alleged injuries related to many of its generic opioid products.
In August 2023, the company announced a major restructuring support agreement with its biggest debtholders and with the opioid trust that was handling its settlement payouts. Mallinckrodt at the time also unveiled plans to file for another Chapter 11 bankruptcy, which a Delaware court approved of in October 2023.
Headquartered in Dublin, Ireland, Mallinckrodt is a specialty pharmaceuticals company that produces both branded and generic drugs. Perhaps its most notable branded product is Terlivaz, an intravenously injected vasopressin receptor agonist that in September 2022 became the first FDA-approved therapy for hepatorenal syndrome, kidney failure linked to liver cirrhosis.
Endo has similarly run into financial difficulties due to opioid lawsuits. The pharma used to manufacture an opioid pain medication called Opana ER, which the FDA in June 2017 flagged for withdrawal due to safety risks associated with opioid overuse. In May 2024, the Justice Department hit Endo with a $1.086 billion fine—plus $450 million for criminal forfeiture—for violating the Federal Food, Drug and Cosmetic Act connected to the distribution of Opana ER.
Endo filed for bankruptcy in August 2022. On Tuesday, the company offloaded its international business to Knight Therapeutics for $84 million upfront and up to $15 million in future payments.
