Eli Lilly Wins Arbitration Hearing Against Adocia

Eli Lilly logo on large outdoor sign

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Eli Lilly won an arbitration hearing over accusations the Indianapolis-based company misused confidential information regarding the intellectual property of its former business partner, France-based Adocia.

Late Thursday, Lilly announced the panel of arbitrators ruled that the company acted appropriately regarding Adocia's intellectual property. They also ruled that Eli Lilly is not liable for any financial damages. The arbitrators did deny a smaller counterclaim that Lilly made against Adocia.

Eli Lilly and Adocia entered into a collaboration in 2014 to develop fast-acting insulin. At the time the deal was struck, the collaboration was worth about $570 million. The fast-acting insulin, known as BioChaperone Lispro, was to be developed for people with type 1 and type 2 diabetes. As BioSpace reported at the time, Lilly struck the deal with Adocia after a Phase IIa trial showed that BioChaperone Lispro had a faster absorption rate than Eli Lilly’s blockbuster insulin, Humalog. The deal with Adocia was short-lived though. Eli Lilly terminated the agreement and discontinued future development, manufacturing, and commercialization related to the program in January 2017.

After the project was terminated by Lilly, Adocia sought reparations for financial losses. Last year, the company announced it had raised its arbitration demands against Lilly to $1.8 billion, a significantly higher amount than the terms of the 2014 agreement. In an announcement last year, Adocia said the updated number was adjusted to include “pre- and post-judgment interest.”

During the proceedings, Lilly had also filed a counterclaim seeking $188 million. Lilly claimed that Adocia concealed its discoveries and confidential information that was at issue with Adocia’s claims, the company said at the time.

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Following Lilly’s announcement this morning that the arbitration panel ruled in its favor, Michael J. Harrington, the company’s general counsel, said he was pleased with the ruling.

“Lilly conducts its business with integrity. We look forward to putting this matter behind us and focusing on the important work of discovering and developing new treatments for people living with diabetes,” Harrington said in a brief statement.

Gérard Soula, chairman and chief executive officer of Adocia, said Adocia was “surprised and disappointed” with the arbitration panel’s decision. Despite the loss, he said the company believes it was responsible to defend itself.

“We remain confident in the value of our strong products portfolio. We stand in a stable financial position and we will benefit from the award from the first arbitration ruling. This allows us to continue the development of our pipeline products, including those in collaboration with our partner, Tonghua Dongbao,” Soula said in a statement.

During the years-long arbitration proceedings, last year the arbitrators awarded Adocia $11.6 million in damages. Adocia noted today that the dismissal of the claims does not impact that previous financial award.

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