Bloomberg News

Siga Bid for Ruling Re-Argument Should Be Denied, Rival Says

October 13, 2011

(Updates with court filing excerpt in third paragraph.)

Oct. 13 (Bloomberg) -- Siga Technologies Inc. should be denied its bid to force a Delaware judge to reconsider his award of 50 percent of the profit from a smallpox drug to PharmAthene Inc., the rival said in court papers.

On Sept. 22, Delaware Chancery Court Judge Donald Parsons ruled that Siga should share possible proceeds of more than $400 million. Siga lawyers last week asked Parsons to let them re-argue their position.

Such motions aren’t mechanisms “to relitigate” issues already decided, unless based “on a misunderstanding” by the judge, PharmAthene lawyer Christopher Selzer wrote in a brief yesterday opposing Siga’s motion.

In addition, since Siga doesn’t challenge the court’s finding that it “acted in bad faith,” a reversal “would not prevent an injustice, but in fact would work an injustice, Selzer contended.

Siga has alleged in a court filing that Parsons “misapprehended both the law and the facts” in awarding a share of ST-246’s profit to Annapolis-based PharmAthene.

Parsons said New York-based Siga breached its obligation to negotiate in good faith on the antiviral drug designed for use in case of a biological attack.

Potential Profits

PharmAthene sued Siga in 2006 claiming the biotechnology firm lost more than $1 billion in potential profits when its rival reneged on a licensing agreement for the smallpox drug.

Siga won a $433 million contract to provide ST-246 to the U.S. Department of Health and Human Services, the company said in May.

Siga lawyers argued at trial that licensing talks were never completed and documents outlining proposed terms were marked as “non-binding.” A PharmAthene official said in court that the heading was left on the documents by mistake.

Siga fell 3 cents to $3.32 at 3:05 p.m. New York time in Nasdaq Stock Market Trading. PharmAthene fell 1 cent to $1.55 in NYSE Amex trading.

The case is PharmAthene Inc. v. Siga Technologies Inc., CA2627, Delaware Chancery Court (Wilmington).

--With assistance from Sophia Pearson in Philadelphia and Dawn McCarty in Wilmington, Delaware. Editors: Mary Romano, Glenn Holdcraft

To contact the reporters on this story: Phil Milford in Wilmington, Delaware, at pmilford@bloomberg.net; Jef Feeley in Wilmington at jfeeley@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


The Good Business Issue
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus