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Mallinckrodt Bankruptcy Pauses ALS Drug Securities Class Action

Dec. 10, 2020, 11:58 PM

A securities class action alleging Mallinckrodt Public Limited Co. and its top officers failed to disclose problems with a drug for amyotrophic lateral sclerosis will be put on hold due to the company’s bankruptcy proceedings, a federal court in New Jersey said Thursday.

The pharmaceutical giant allegedly failed to disclose safety concerns about the injectable drug H.P. Acthar Gel, and accordingly overstated its viability as an ALS treatment. When the company announced it was discontinuing phase 2B trials of the drug in July 2019, its stock price fell 7.8%, the plaintiffs claimed.

Mallinckrodt filed for bankruptcy in October. The ...

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