Mallinckrodt (NYSE: MNK) reported Q2 EPS of $1.89, $0.54 better than the analyst estimate of $1.35. Revenue for the quarter came in at $700.9 million versus the consensus estimate of $635.33 million.

• Second quarter net sales of $166.5 million net of the retrospective one-time Acthar® Gel Medicaid liability; adjusted net sales of $700.9 million, a decline of 14.9%, due primarily to demand impacts related to COVID-19 and competitive and payer pressures on certain products
• Diluted loss per share of $11.04 with adjusted diluted earnings per share (EPS) of $1.89, a decline of 25.3%
• Operating cash flows of $170.9 million in the quarter with free cash flow of $159.5 million
• Key pipeline advancements include:
• A positive vote by the U.S. Food and Drug Administration (FDA) advisory committee for terlipressin
• Completion of a rolling submission of a Biologics License Application (BLA) to the FDA for StrataGraft® regenerative skin tissue
• Company continues to work to resolve outstanding issues related to opioids, Acthar Gel, and other risks, as well as address overall debt levels, and is considering with its external advisors all options to address legal and financial challenges. While no final determination has been made, it is possible that Mallinckrodt plc and most of its subsidiaries could file for Chapter 11 reorganization in the near term

"Our reported GAAP net sales were impacted by the retrospective one-time Acthar Gel Medicaid liability, and our normalized operating results also displayed a contraction this quarter due to the COVID-19 health crisis along with increased competitive and payer pressures on certain products. Amidst these challenges, we continued to operate well, which is a testament to our employees' hard work and commitment to our business, patients and customers," said Mark Trudeau, President and Chief Executive Officer of Mallinckrodt. "We also continue to execute on our strategic priorities – making important progress in advancing our pipeline, including a positive outcome of the recent advisory committee meeting on terlipressin and completion of a rolling submission of a Biologics License Application (BLA) to the FDA for StrataGraft® regenerative skin tissue."

Trudeau continued, "Looking ahead, we expect our current challenges to continue in the back half of the year. We remain committed to ensuring patients have uninterrupted access to our medicines throughout the COVID-19 health crisis. We continue to be highly focused in the near term on addressing all legal and financial challenges impacting the business."

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