Last week a Delaware Court of Chancery issued its final judgment in litigation spanning over 5 years brought by PharmAthene, Inc. against SIGA Technologies.
The court found in favor of PharmAthene, entitling the company to 50% of the net profits over 10 years from all sales of SIGA Technologies’ ST-246, a novel smallpox antiviral agent being developed by SIGA. The profit sharing will kick in once SIGA receives the first $40 million in net profits from sales of ST-246.
The dispute dates back to a merger agreement between the two companies. When SIGA withdrew from the agreement, PharmAthene sued over rights to the anti-smallpox drug, ST-246, a countermeasure funded heavily by the Biomedical Advanced Research and Development Authority (BARDA).
SIGA was additionally ordered to pay $2.4M towards PharmAthene’s legal costs. Company leadership expressed disappointment with the overall decision and announced plans to appeal the ruling. “We obviously remain disappointed at the overall result, but we are focused on executing on our BARDA contract and obtaining FDA approval for ST-246,” stated SIGA CEO Eric Rose.
In 2011, BARDA awarded SIGA a base contract for the initial procurement of 1.7 million treatment courses of ST-246 in support of the Strategic National Stockpile. The five-year base contract award is valued at $433 million, of which approximately $412.5 million is for purchase of the product. According to a PharmAthene press release, SIGA forecasted in May 2011 that if the government were to purchase an additional 12 million treatment courses of smallpox antiviral, the total value for the current U.S. civilian market, including the initial base contract for 1.7 million courses of therapy, could be approximately $2.8 billion.
A full copy of the Final Order and Judgment is available here.
