Mallinckrodt plc to Acquire Cadence Pharmaceuticals, Inc.

Transaction accelerates growth in Mallinckrodt’s Specialty Pharmaceuticals segment with addition of a high-growth, differentiated pain product

Acquisition supports Mallinckrodt’s expansion into the hospital channel

Acquisition expected to be immediately accretive to Mallinckrodt’s fiscal year 2014 adjusted diluted earnings per share; and significantly accretive to Mallinckrodt’s fiscal year 2015 adjusted diluted earnings per share

Dublin and San Diego, CA — Mallinckrodt plc (NYSE: MNK), a leading global specialty pharmaceuticals company, and Cadence Pharmaceuticals, Inc. (NASDAQ: CADX) today announced that they have entered into a definitive agreement under which a subsidiary of Mallinckrodt plc will commence a tender offer to acquire all outstanding shares of Cadence Pharmaceuticals, Inc. for $14.00 per share in cash or approximately $1.3 billion on a fully diluted basis, which represents a 32% premium to the trailing 30-trading-day volume weighted average price (VWAP) of $10.62 per share for Cadence Pharmaceuticals, Inc.

Subject to customary terms and conditions, the parties expect the transaction to close in mid- to late-March. Mallinckrodt expects the acquisition will be immediately accretive to its fiscal year 2014 adjusted diluted earnings per share, and significantly accretive to its fiscal year 2015 adjusted diluted earnings per share.

Cadence Pharmaceuticals is a biopharmaceutical company focused on commercializing products principally for use in the hospital setting. The company’s product OFIRMEV® (acetaminophen injection) is a proprietary intravenous formulation of acetaminophen for the management of mild to moderate pain, the management of moderate to severe pain with adjunctive opioid analgesics and the reduction of fever. Since its introduction, OFIRMEV has experienced strong growth, and in a press release issued January 13, 2014, Cadence reported that it expects net revenues of $110.5 million for OFIRMEV in calendar year 2013 compared to 2012 reported OFIRMEV net product revenues of $50.1 million. OFIRMEV is currently on formulary in more than 2,350 U.S. hospitals and has been used to treat an estimated 6 to 7 million patients since its launch in January 2011 A New Drug Submission for the product has been approved by Health Canada.

This transaction accelerates growth in Mallinckrodt’s Specialty Pharmaceuticals segment in key ways. First, the company adds another powerful growth product, OFIRMEV, to the segment’s robust portfolio of core controlled substance generics and its growing roster of brands like EXALGO®, Gablofen®, PENNSAID® 2% and, if approved, XARTEMIS™ XR and longer term, MNK-155. Additionally with the strong presence Cadence has established in the adjacent hospital market, the acquisition adds another potential growth dimension for the segment, providing Mallinckrodt an opportunity to expand the company’s reach and penetration in this important channel.

“The acquisition of Cadence Pharmaceuticals is consistent with our goal of becoming a leading global specialty pharmaceuticals company,” said Mark Trudeau, Chief Executive Officer and President of Mallinckrodt. “OFIRMEV’s growth is driven by an expanding base of physicians who are prescribing the product for an increasing number of surgical patients, and we believe the product will be an outstanding addition to the brands component of Mallinckrodt’s Specialty Pharmaceutical segment. We have been impressed with the strong relationships that Cadence’s commercial organizations have established with customers in the hospital channel and are excited by the opportunity to build on these relationships to expand our platform in this area. We believe Mallinckrodt is well-positioned to further accelerate the trajectory of OFIRMEV and realize the full value of this product in the marketplace.”

“We are very proud of what our employees have accomplished, and in particular the very strong growth we have achieved with OFIRMEV,” said Ted Schroeder, President and Chief Executive Officer of Cadence Pharmaceuticals. “The relationships we’ve established with our customers and the benefits the drug has provided to millions of patients across the U.S. have contributed to the strong year-on-year growth we’ve seen for the product since launch. We believe Mallinckrodt is a natural fit to provide the resources and expertise that can expand patient access for OFIRMEV. Additionally, this transaction will provide Cadence shareholders with a strong return on their investment.”

Additional Terms of the Transaction

The Boards of Directors of both companies have unanimously approved the transaction. Under the terms of the agreement, a subsidiary of Mallinckrodt plc will commence a tender offer to purchase all of the outstanding shares of Cadence Pharmaceuticals, Inc. common stock for $14.00 per share in cash. The completion of the tender offer is subject to customary terms and conditions, including Cadence Pharmaceuticals’ stockholders tendering a majority of Cadence Pharmaceuticals’ outstanding shares and the expiration or termination of the waiting period under the Hart Scott Rodino Antitrust Improvements Act. Following the successful completion of the tender offer, the agreement provides that Cadence Pharmaceuticals, Inc. will merge with a subsidiary of Mallinckrodt and become a wholly-owned subsidiary of Mallinckrodt, and all remaining outstanding shares of Cadence Pharmaceuticals, Inc. will receive the same consideration paid to other stockholders in the tender offer.

The tender offer is expected to be completed in mid- to late-March 2014, subject to the satisfaction or waiver of the offer conditions. In connection with the tender offer, certain funds affiliated with Domain Associates, Cam L. Garner, James C. Blair, William R. LaRue and certain other entities have entered into a tender and support agreement with Mallinckrodt plc pursuant to which they have agreed to tender an aggregate of approximately 13% of Cadence Pharmaceutical’s outstanding shares in the offer. Following the completion of the transaction, Cadence Pharmaceuticals, Inc. shares will be delisted from NASDAQ.

Financing

Mallinckrodt plc has entered into debt financing commitments with affiliates of Deutsche Bank Securities Inc. that, together with cash on hand, are expected to provide the funds necessary to consummate the acquisition. Mallinckrodt expects that the financing for the transaction will be a senior secured term loan facility.

Advisors

Mallinckrodt’s financial advisor for the transaction is Deutsche Bank Securities Inc., and its legal advisors are Wachtell, Lipton, Rosen & Katz in the U.S. and Arthur Cox in Ireland.

Cadence Pharmaceuticals’ financial advisors for the transaction are Lazard and Centerview Partners and its legal advisor is Latham & Watkins LLP.

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