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Mallinckrodt leaves pharma industry group, eying new member rules

April 5, 2017

Mallinckrodt PLC resigned from the Pharmaceutical Research and Manufacturers Association on Monday ahead of potential changes to the trade group’s bylaws that could exclude companies that don’t spend significant funds on researching and developing new drugs, according to a person familiar with the matter.

PhRMA, a Washington-based group that represents many of the largest global drugmakers, will vote on changes to its membership criteria at its next board meeting in early May, the person said. The changes, if approved, would require that members are committed to conducting significant medical and scientific research, though the person didn’t say what the specific criteria would be or whether there would be a monetary threshold for R&D spending.

Mallinckrodt’s MNK, +0.64%  decision to resign from the group was made in anticipation of the membership criteria being changed by the board next month and possibly excluding the company, the person familiar with the matter said.

“Mallinckrodt routinely evaluates its engagement in trade associations and policy organizations and has concluded that the significant financial and time commitment required as a full PhRMA member outweighs its direct policy value to us at this time,” the company said in a statement provided to The Wall Street Journal.


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