May 21, 2019

Drugmaker sues feds over medication payment change

HHS headquarters in Washington. Photo: Saul Loeb/AFP via Getty Images

Mallinckrodt is suing the Centers for Medicare & Medicaid Services and the Department of Health and Human Services for changing the way Medicaid rebates are calculated for its pricey H.P. Acthar Gel medication, a move that would require Mallinckrodt to pay back large sums of money to the federal government.

Why it matters: The drug company expects the change will eliminate 10% of its Acthar sales, and that it will have to pay up to $600 million in retroactive rebates — news that sent the company's stock plunging by 24% Tuesday to a record-low $9.87 per share.

Reality check: Acthar has been under the gun for several years now. Independent experts say the drug, which is a half-century old and treats multiple sclerosis and infantile spasms, is excessively priced and isn't any better than cheaper alternatives.

The bottom line: Mallinckrodt is fighting tooth and nail to protect Acthar because it is the lifeblood of the company. The drug makes up 35% of Mallinckrodt's revenue.

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Scoop: German foreign minister to travel to Israel with warning on annexation

Heiko Maas. Photo: Michael Kappeler/picture alliance via Getty Images

German Foreign Minister Heiko Maas is expected to travel to Israel next week to warn that there will be consequences if Israeli leaders move forward with plans to annex parts of the West Bank, Israeli officials and European diplomats tell me.

Why it matters: Israeli and European officials agree that if Israel goes ahead with unilateral annexation, the EU will respond with sanctions.

Minneapolis will ban police chokeholds following George Floyd's death

A memorial for George Floyd at the site of his death in Minneapolis. Photo: Steel Brooks/Anadolu Agency via Getty Images

Minneapolis has agreed to ban the use of police chokeholds and will require nearby officers to act to stop them in the wake of George Floyd's death, AP reports.

Why it matters: The agreement between the city and the Minnesota Department of Human Rights, which has launched an investigation into Floyd's death while in police custody, will be enforceable in court.