New York

EARLY last year, drugmaker Mallinckrodt plc spent US$1.3 billion to buy a company that sold an injectable form of acetaminophen - essentially Tylenol in a liquid solution.

Within months, the new owner more than doubled the price of the drug, called Ofirmev. Revenue from the medication shot up, too, and hospitals searched for ways to absorb the costs - large hospital systems such as Johns Hopkins Medicine and New York University Langone Medical Center said that their expenses surged US$1 million a year or more.