User blog comment:BIA-Kaboose/The Problem Behind Balance/@comment-13944607-20131211174748/@comment-1330314-20131211184940

Madred's Bloodrazor had rather large design issues: its stats and on-hit effect were clearly designed for ADCs, but its max health damage per hit was a nightmare in terms of both balancing and countering: if you're up against a marksman, you're going to be building armor, but with this item they get to deal large amounts of damage that completely sidesteps your build (which is why it was so strong). As a marksman, you're going to be building armor penetration to counter tanks, but Madreds's on-hit effect doesn't benefit from that at all. The other issue is that its magic damage was enough to kill targets entirely on its own, even if the enemy was super-tanky and built tons of armor. That's why and  deal damage based on current and not maximum health: it's meant to be a counter to tanky enemies, not just a massive damage boost.