Ahead of the bellwether opioid trial set to begin next month, Mallinckrodt is considering various options, including a bankruptcy filing to contain a likely legal payout, Bloomberg reported.
The drugmaker has hired law firm Latham & Watkins and turnaround consulting firm AlixPartners as advisors in an attempt to limit its potential legal liabilities as thousands of states, cities and counties seek to blame the drugmaker for its alleged role in fueling the opioid crisis.
In addition to hiring restructuring advisors, Mallinckrodt is negotiating with lawyers for the plaintiff cities and counties in hopes of working out a deal to avoid the trial set to begin Oct. 21 in Cleveland, Bloomberg reported.
Mallinckrodt, which has a $5 billion debt burden, has lost about three-quarters of its market value this year as investors assessed the potential liability posed by opioid-related lawsuits.The news of a potential bankruptcy filing sent the drugmaker's bonds plunging and wiped out more of the company's stock-market value, with shares reaching a record low of $1.43, according to Bloomberg.
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