"The acquisition stifled competition by preventing any other company from using the Synacthen assets to develop a synthetic ACTH drug, preserving Questcor's monopoly and allowing it to maintain extremely high prices for Acthar," the FTC said.
After that purchase, "Questcor took advantage of its monopoly to repeatedly raise the price of Acthar, from $40 per vial in 2001 to more than $34,000 per vial today — an 85,000 percent increase," said FTC Chairwoman Edith Ramirez. According to the FTC's complaint, an Acthar treatment for infantile spasms can cost more than $100,000.
"We charge that, to maintain its monopoly pricing, it acquired the rights to its greatest competitive threat, a synthetic version of Acthar, to forestall future competition. This is precisely the kind of conduct the antitrust laws prohibit," Ramirez said.
The FTC said that, "In addition to the $100 million monetary payment, the proposed stipulated court order requires that Questcor grant a license to develop Synacthen Depot to treat infantile spasms and nephrotic syndrome to a licensee approved by the commission."
Under terms of the deal, the states of Alaska, Maryland, New York, Texas and Washington will split $10 million from the settlement, and an additional $2 million in attorneys' fees and costs.
Mallinckrodt shares fell more than 8 percent before trading was halted in advance of the company's disclosure of the FTC settlement. It resumed trading less than an hour later, and recouped some of its losses. The stock ended the day down 5.9 percent at 46.53, and was active in after-hours trading.
After trading was halted, Mallinckrodt issued a statement that said, "We are pleased to confirm that we have entered into a settlement agreement with the FTC staff to fully resolve this matter, subject to approval by the Commission. We will comment further at the appropriate time."
The stock plunge came after The New York Post reported Wednesday that the FTC "is preparing to file charges" against the company."
The Post's story noted that the FTC has been investigating Mallinckrodt's Questcor Pharmaceuticals unit since a 2014 lawsuit filed by notorious pharmaceutical executive Martin Shkreli, then CEO of drugmaker Retrophin.