Empty paragraphs around figure and figcaption tags when using markdown

I'm using WP 3.8 and Markdown on Save Improved plugin and have following code for outputing HTML5 tags when inserting images via Media Uploader:

function html5_insert_image($html, $id, $caption, $title, $align, $url, $size, $alt) {
  $src  = wp_get_attachment_image_src( $id, $size, false );
  $html5 = "figure";
  $html5 .= "img src='$src[0]' alt='$alt' /";
  if ($caption) {
    $html5 .= "figcaption$caption/figcaption";
  }
  $html5 .= "/figure";
  return $html5;
}
add_filter( 'image_send_to_editor', 'html5_insert_image', 10, 9 );

And in editor output is fine, but on publish my code looks like this:

p/p
figure
img src="image_link" alt="alt_txt"
p/p
figcaptioncaption_txt/figcaption
p/p
/figure
p/p

If I put div wrapper around figure then there are no empty paragraphs but I'm wondering why figure and figcaption aren't recognized as block elements? Also, this doesn't happen with wp-markdown plugin so it seems it's not markdown problem since both plugins use same parser.

When combining HTML and markdown in other ways, output is fine so I think that's not the issue.