Despite the previous bankruptcy settlement that resolved those litigation threats and cut $1.5 billion in debt, Mallinckrodt quickly found itself in financial trouble again due to declining sales for its key branded drugs, including Acthar Gel. As part of its previous bankruptcy, Mallinckrodt, which denied wrongdoing, agreed to pay $1.7 billion to settle about 3,000 lawsuits alleging it used deceptive marketing tactics to boost opioid sales. Unlike the opioid settlement, Mallinckrodt intends to pay the full amount due under the Acthar settlement after its second bankruptcy. Dorsey overruled an objection filed by shareholder Alta Fundamental Advisers, which had argued that Mallinckrodt improperly rushed into a second bankruptcy at the expense of equity owners. The reorganized company has a total enterprise value of about $2.95 billion, according to Mallinckrodt's financial advisor Guggenheim Securities.

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Persons: Hydrocodine, Mallinckrodt, George Frey, John Dorsey, Siggi Olafsson, Mallinckrodt's, Dorsey, Dietrich Knauth, Alexia Garamfalvi, Bill Berkrot, Richard Chang Organizations: REUTERS, Tuesday, Acthar, Deerfield Partners, JPMorgan Investment Management, Fundamental Advisers, Securities, Thomson Locations: Provo , Utah, U.S, Ireland, Wilmington , Delaware