S&P might lower Mallinckrodt

S&P said it placed the ratings on Mallinckrodt plc, including the BB- corporate credit rating, on CreditWatch with negative implications.

The agency said the CreditWatch placement follows Mallinckrodt's announcement that it will acquire Sucampo Pharmaceuticals Inc. for $1.2 billion.

“The acquisition raises debt leverage and we believe that despite the company's solid cash flow generation, adjusted debt leverage could remain elevated,” S&P said in a news release.

“In addition, operating performance has weakened with sales softness in key drug H.P. Acthar Gel and ongoing declines in the generic business.”

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