Confirmed it still drops.
I was going through this area of Howling Stones, on my way to camp the Erudite Mask for my Bard, and I saw this mob.. decided it looked too happy being alive, so I made short work of it.. Had no idea this item dropped off of this mob, but got it first shot!
He is in the west side of Howling Stones, in a long hallway leading to the teleport pad.