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Open Letter to Mallinckrodt Employees, Customers and Patients Reinforcing Important Facts Related to H.P. Acthar Gel and Other Matters

September 12, 2017

Mallinckrodt's mission is to provide safe, effective treatments that improve the lives of patients. Our employees live this mission every day. Ongoing media reports, publications and public comments by acknowledged critics simply repeat previously published misstatements of facts and unsupported allegations.

Repeated assertions of these themes and claims do not make them true.

An analysis published in JAMA Internal Medicine claims that there is little to no evidence that H.P. Acthar Gel® works in treatment of multiple sclerosis (MS) exacerbations and that other less costly alternatives (high dose corticosteroids) aren't being prescribed – increasing costs to the entire healthcare system and Medicare in particular.
FACT: H.P. Acthar Gel (repository corticotropin injection) is U.S. Food and Drug Administration (FDA)-approved for treatment of acute exacerbations (or relapses) of multiple sclerosis (MS) in adults. H.P. Acthar Gel is not a form of corticosteroid. It is a complex organic formulation containing a peptide chain long known to stimulate natural steroid production from a patient's own adrenal gland. Though steroids are commonly used as a first line treatment of MS relapse, data from the North American Research Committee on Multiple Sclerosis indicates 30% of MS relapse patients had no response to steroids. Additionally, some patients cannot tolerate steroids. Because of these factors, H.P. Acthar Gel can provide an important treatment option for patients who need an alternative therapy.
FACT: More than 50 years of clinical experience support the effectiveness of H.P. Acthar Gel in treatment of appropriate patients. Since acquiring the product in 2014, Mallinckrodt has initiated a number of new randomized clinical trials (link) on the drug (including a double-blind, randomized placebo controlled MS relapse trial and a MS relapse registry) as well as providing ongoing support for investigator sponsored trials (link) and health economic and outcomes research. Additionally, the FDA updated Acthar's label in 2010, after determining there was sufficient scientific and clinical evidence to support the 19 indications now in the current label. H.P. Acthar Gel makes a significant difference in the lives of thousands of very sick patients with high unmet medical needs. Furthermore, as to pricing, Mallinckrodt has made a public pledge to price its products responsibly (link), and in a way that reflects the value they offer patients, providers and the U.S. healthcare system as a whole.

Claims were repeated that Mallinckrodt and Express Scripts have an inappropriate relationship

FACT: There is no inappropriate relationship between Mallinckrodt and Express Scripts. Mallinckrodt has long engaged – and has appropriate contracts with – the majority of the largest Pharmacy Benefit Managers in the U.S. including Express Scripts. Furthermore, we engage with a variety of partners in all parts of the industry value chain to ensure access for appropriate patients who are prescribed H.P. Acthar Gel.

The erroneous claim was repeated that H.P. Acthar Gel contributes or represents the "vast majority" of Mallinckrodt's annual revenue and profitability – falsely supported by claims made in a lawsuit by a former employee alleging that the company had misrepresented the contribution of the drug to its overall results.

FACT: Though H.P. Acthar Gel makes a substantial contribution to Mallinckrodt's overall profitability, many people mistakenly underestimate the significant contributions of the rest of the company's diversified portfolio. While Mallinckrodt does not publicly disclose the profitability of any individual product, revenues for its portfolio of hospital products alone were approximately equal to those for H.P. Acthar Gel in fiscal 2016 as were revenue contributions from the company's specialty generics segment.

FACT: A "tag-along" lawsuit (referenced above) has been filed involving many of the same allegations as a consolidated class action security litigation filed against Mallinckrodt and certain company officers in January 2017. This recent lawsuit was brought by a single former employee who claims to represent participants in the company's employee stock purchase plan. Mallinckrodt believes the claims in these lawsuits are baseless will defend itself vigorously. The company's officers take their fiduciary responsibilities very seriously.

As I said in in the opening of this letter, Mallinckrodt's mission is to provide safe, effective treatments like H.P. Acthar Gel that make a difference in the lives of patients every day. When we are challenged by critics distorting facts and making unfounded claims, we will continue to support and defend our medicines and our company with the truth.

Sincerely,
Hugh M. O'Neill
Executive Vice President and President, Autoimmune and Rare Diseases

About H.P. Acthar Gel (repository corticotropin injection)
Indications
H.P. Acthar Gel is an injectable drug approved by the FDA for the treatment of 19 indications. Of these, today the majority of Acthar use is in these indications:

• Treatment during an exacerbation or as maintenance therapy in selected cases of systemic lupus erythematosus
• Monotherapy for the treatment of infantile spasms in infants and children under 2 years of age
• The treatment of acute exacerbations of multiple sclerosis in adults. Controlled clinical trials have shown H.P. Acthar Gel to be effective in speeding the resolution of acute exacerbations of multiple sclerosis. However, there is no evidence that it affects the ultimate outcome or natural history of the disease
• Inducing a diuresis or a remission of proteinuria in nephrotic syndrome without uremia of the idiopathic type or that due to lupus erythematosus
• Treatment during an exacerbation or as maintenance therapy in selected cases of systemic dermatomyositis (polymyositis)
• The treatment of symptomatic sarcoidosis
• Adjunctive therapy for short-term administration (to tide the patient over an acute episode or exacerbation) in rheumatoid arthritis, including juvenile rheumatoid arthritis (selected cases may require low-dose maintenance therapy)
• Treatment of severe acute and chronic allergic and inflammatory processes involving the eye and its adnexa such as: keratitis, iritis, iridocyclitis, diffuse posterior uveitis and choroiditis, optic neuritis, chorioretinitis, anterior segment inflammation
• Adjunctive therapy for short-term administration (to tide the patient over an acute episode or exacerbation) in rheumatoid arthritis, including juvenile rheumatoid arthritis (selected cases may require low-dose maintenance therapy)

IMPORTANT SAFETY INFORMATION
Contraindications

• Acthar should never be administered intravenously
• Administration of live or live attenuated vaccines is contraindicated in patients receiving immunosuppressive doses of Acthar
• Acthar is contraindicated where congenital infections are suspected in infants
• Acthar is contraindicated in patients with scleroderma, osteoporosis, systemic fungal infections, ocular herpes simplex, recent surgery, history of or the presence of a peptic ulcer, congestive heart failure, uncontrolled hypertension, primary adrenocortical insufficiency, adrenocortical hyperfunction or sensitivity to proteins of porcine origins

Warnings and Precautions

• The adverse effects of Acthar are related primarily to its steroidogenic effects
• Acthar may increase susceptibility to new infection or reactivation of latent infections
• Suppression of the hypothalamic-pituitary-axis (HPA) may occur following prolonged therapy with the potential for adrenal insufficiency after withdrawal of the medication. Adrenal insufficiency may be minimized by tapering of the dose when discontinuing treatment. During recovery of the adrenal gland patients should be protected from the stress (e.g. trauma or surgery) by the use of corticosteroids. Monitor patients for effects of HPA suppression after stopping treatment
• Cushing's syndrome may occur during therapy but generally resolves after therapy is stopped. Monitor patients for signs and symptoms
• Acthar can cause elevation of blood pressure, salt and water retention, and hypokalemia. Blood pressure, sodium and potassium levels may need to be monitored
• Acthar often acts by masking symptoms of other diseases/disorders. Monitor patients carefully during and for a period following discontinuation of therapy
• Acthar can cause GI bleeding and gastric ulcer. There is also an increased risk for perforation in patients with certain gastrointestinal disorders. Monitor for signs of bleeding
• Acthar may be associated with central nervous system effects ranging from euphoria, insomnia, irritability, mood swings, personality changes, and severe depression, and psychosis. Existing conditions may be aggravated
• Patients with comorbid disease may have that disease worsened. Caution should be used when prescribing Acthar in patients with diabetes and myasthenia gravis
• Prolonged use of Acthar may produce cataracts, glaucoma and secondary ocular infections. Monitor for signs and symptoms
• Acthar is immunogenic and prolonged administration of Acthar may increase the risk of hypersensitivity reactions. Neutralizing antibodies with chronic administration may lead to loss of endogenous ACTH activity
• There is an enhanced effect in patients with hypothyroidism and in those with cirrhosis of the liver
• Long-term use may have negative effects on growth and physical development in children. Monitor pediatric patients
• Decrease in bone density may occur. Bone density should be monitored for patients on long-term therapy
• Pregnancy Class C: Acthar has been shown to have an embryocidal effect and should be used during pregnancy only if the potential benefit justifies the potential risk to the fetus

Adverse Reactions

• Common adverse reactions for Acthar are similar to those of corticosteroids and include fluid retention, alteration in glucose tolerance, elevation in blood pressure, behavioral and mood changes, increased appetite and weight gain
• Specific adverse reactions reported in IS clinical trials in infants and children under 2 years of age included: infection, hypertension, irritability, Cushingoid symptoms, constipation, diarrhea, vomiting, pyrexia, weight gain, increased appetite, decreased appetite, nasal congestion, acne, rash, and cardiac hypertrophy. Convulsions were also reported, but these may actually be occurring because some IS patients progress to other forms of seizures and IS sometimes mask other seizures, which become visible once the clinical spasms from IS resolve

Other adverse events reported are included in the full Prescribing Information.
Please see full Prescribing Information.
For parents and caregivers of IS patients, please also see Medication Guide.

ABOUT MALLINCKRODT
Mallinckrodt is a global business that develops, manufactures, markets and distributes specialty pharmaceutical products and therapies. Areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, nephrology, pulmonology and ophthalmology; immunotherapy and neonatal respiratory critical care therapies; and analgesics and hemostasis products. The company's core strengths include the acquisition and management of highly regulated raw materials and specialized chemistry, formulation and manufacturing capabilities. The company's Specialty Brands segment includes branded medicines and its Specialty Generics segment includes specialty generic drugs, active pharmaceutical ingredients and external manufacturing. To learn more about Mallinckrodt, visit www.mallinckrodt.com.

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CONTACTS

Investor Relations
Coleman N. Lannum, CFA
Senior Vice President, Investor Strategy and IRO
314-654-6649
cole.lannum@mallinckrodt.com

Daniel J. Speciale, CPA
Director, Investor Relations
314-654-3638
daniel.speciale@mallinckrodt.com

Media
Rhonda Sciarra
Senior Communications Manager
908-238-6765
rhonda.sciarra@mallinckrodt.com

Meredith Fischer
Chief Public Affairs Officer
314-654-3318
meredith.fischer@mallinckrodt.com

Government Affairs
Mark Tyndall
Vice President, Government Affairs, Public Policy and Advocacy
202-459-4141
mark.tyndall@mallinckrodt.com