This Drugmaker Suffered the Consequences of Price Increases
- Mallinckrodt's IV acetominophen volume fell after price hike
- Company has worked with hospitals to help boost demand
Ramipril capsules fall into a collection bin at the Lupin Ltd. pharmaceutical plant in Salcette, Goa, India, on Friday, Feb. 7, 2014. Lupin, founded by billionaire Desh Bandhu Gupta, expects to gain share in the U.S. amid increased regulatory oversight and curbs on competitors including Ranbaxy Laboratories Ltd.
Photographer: Dhiraj Singh/BloombergEarly last year, drugmaker Mallinckrodt Plc spent $1.3 billion to buy a company that sold an injectable form of acetaminophen -- essentially Tylenol in a liquid solution.
Within months, the new owner more than doubled the price of the drug, called Ofirmev. Revenue from the medication shot up, too, and hospitals searched for ways to absorb the costs -- large hospital systems like Johns Hopkins Medicine and New York University Langone Medical Center say their expenses surged $1 million a year or more.