Wachtell Lipton Rosen & Katz and Davis Polk & Wardwell have scored lead roles on the $6.7bn merger of drugmakers Mallinckrodt and Endo.

Wachtell is serving as lead counsel for Dublin-based Mallinckrodt on the deal, which is also being advised by Hogan Lovells and Irish heavyweight Arthur Cox. 

Meantime Davis Polk is lead counsel to Endo, which is based in Malvern, Pennsylvania. Endo is also being counselled on the deal by Paul Weiss and top-tier Irish outfit A&L Goodbody. 

Both Wachtell and Davis Polk are among the top 10 M&A law firms by deal value. Davis Polk ranked eighth in London Stock Exchange Group’s 2024 rankings after acting on deals worth nearly $261bn, including the $16.5bn acquisition of US drugmaker Catalent by the controlling shareholder of Novo Nordisk. Meantime, Wachtell came in ninth after advising on $240bn of deals. 

The New York-based Davis Polk team guiding Endo is led by M&A partner Michael Davis and includes partners David Bauer (IP), Veronica Wissel (executive compensation) and Michael Mollerus (tax). 

The same Davis Polk partners are also advising the company on the divestiture of its international pharmaceuticals business to Canada’s Knight Therapeutics for up to $99m, in a deal announced earlier this week. Knight is being advised on the deal by a team from Toronto-based Davies Ward Phillips & Vineberg. 

The deals follow Endo filing for bankruptcy in 2022 to address its $8bn debt and thousands of lawsuits over its alleged role in the US opioid crisis, including the marketing of its opioid painkiller, Opana ER, which Endo withdrew from the market in 2017. The firm turned to Skadden and bankruptcy boutique Togut Segal & Segal for counsel on the matter and emerged from bankruptcy last year after the US Bankruptcy Court in the Southern District of New York approved its restructuring plan and related opioid settlements. 

Meantime Mallinckrodt went bankrupt in 2020 due to its high debt load and litigation over allegedly deceptive marketing of generic opioids and again two years ago due to poor sales of its key branded drugs. The firm completed its restructuring later that year, having been counselled by Latham & Watkins, Wachtell, Arthur Cox, Delaware firm Layton & Finger and Hogan Lovells.  

Bloomberg reported the Wachtell team advising Mallinckrodt on the Endo merger is being led by New York corporate partner Victor Goldfeld. He has guided the company on previous deals including its $1.2bn acquisition of Sucampo Pharmaceuticals in 2018. 

The Hogan Lovells team acting for Mallinckrodt in the merger includes partners William Inter (corporate), Adrienne Ellman (M&A), Alice Valder Curran (regulatory) and Carin Carithers (executive compensation and employee benefits). 

The merged company is expected to generate $3.6bn in 2025 revenue and will combine each side’s branded drugs businesses, such as Mallinckrodt’s kidney disease treatment Terlivaz and Endo’s testosterone injection Aveed. 

Mallinckrodt CEO, Siggi Olafsson, said the deal will “create a larger and more diversified entity with the scale and resources needed to unlock the full potential of both companies”.

The companies said they also plan to combine their generic drug businesses and Endo’s sterile injectables business into another company that will be spun out after the deal closes. 

Endo shareholders will receive $80m in cash and own 49.9% of the combined company, while Mallinckrodt shareholders will own the rest for an enterprise value of $6.7bn. 

The A&L Goodbody team acting for Endo is led by head of corporate Alan Casey, alongside partners Deirdre Geraghty (corporate), Amelia O’Beirne (tax), Peter Murray (finance) and Alan McCarthy (anti-trust and regulatory).

Endo will become a wholly owned subsidiary of Mallinckrodt, with Olafsson serving as CEO of the combined company after the deal’s expected close in the second half of this year. The merged company will be listed on the New York Stock Exchange.

Lazard is serving as Mallinckrodt’s financial adviser on the deal. Goldman Sachs is acting as Endo’s financial adviser.