Trial Date Set for Napo Pharmaceuticals, Inc. Breach of Contract Claim Against Salix Pharmaceuticals, Ltd.
Published: Nov 04, 2013
SAN FRANCISCO, Nov. 4, 2013 /PRNewswire/ -- A February 10, 2014 trial date has been set in New York County State Supreme Court to decide breach of contract claims brought by Napo Pharmaceuticals, Inc. (Napo) against its licensee, Salix Pharmaceuticals, Inc. (Salix) (NASDAQ: SLXP). Napo initiated the lawsuit in May 2011 in response to material breaches of the agreement by Salix that delayed the development of a licensed drug and have delayed its commercialization.
Prior to signing a collaboration agreement with Salix, Napo had received FDA "fast-track" designation for two distinct uses of the product. The FDA grants "fast-track" status to drugs that address important unmet medical needs.
In December 2008, Napo entered into a collaboration agreement with Salix for development and commercialization of the licensed drug candidate for all human anti-diarrheal uses in the United States, Europe, and Japan that included diarrhea in people living with HIV/AIDS. Salix was also licensed the worldwide rights to other gastrointestinal indications, including Irritable Bowel Syndrome ("IBS"). At that time Napo and a predecessor company, Shaman, had already invested more than $200 million in the development, manufacture, and characterization of the licensed drug, including initiating and implementing an on-going final pivotal Phase 3 trial. The licensed drug is isolated and purified from Croton lechleri, a medicinal plant that has been sustainably harvested from the Amazon Rain Forest by Napo.
Napo's attorney, William S. Ohlemeyer of Boies, Schiller & Flexner said, "The delays caused by Salix in the development and commercialization of a drug the FDA has proclaimed treats an important and unmet medical need were not reasonable in light of the promises Salix made to Napo and are a clear breach of the Collaboration Agreement the parties signed in 2008. Napo is suing to recover substantial damages and terminate the license agreement so that it can work to assure that this drug attains its full potential to help patients."
About diarrheal related diseases:
Chronic diarrhea in people living with HIV/AIDS on anti-retroviral therapy ("ART") afflicts ~350,000 people in the US and 90% of the 33 million people living with HIV/AIDS globally. Lack of management of diarrhea has been associated with poor adherence to ART and the emergence of resistant viral strains.
IBS is a common bowel disorder affecting 10-15% of the adult population with symptoms that vary widely from patient to patient. In the US, approximately 35 million adults suffer from IBS, and there are an additional 50 million sufferers in Europe and Japan. Approximately 60% of prevalent IBS cases have a diarrheal component. IBS has significant debilitating effects on patients with many reporting frequent or continuous abdominal pain, restrictions on their activities and loss of control over their lives due to IBS.
Diarrhea is also often experienced by patients receiving cancer chemotherapy with some chemotherapeutic regimens associated with diarrhea rates as high as 50% to 80%. Chemotherapy Induced Diarrhea (CID) has significant and life-threatening consequences, requiring treatment changes or the reduction, delay, or discontinuation of chemotherapy.
Cholera is an acute diarrheal disease caused by ingestion of contaminated food or water that can sometimes kill within hours if left untreated. Every year, there are an estimated 3-5 million cholera cases and 100,000-120,000 deaths due to cholera worldwide. In addition, dehydration from diarrhea kills approximately 2 million children worldwide, and has lifetime health effects on hundreds of millions more.
Napo focuses on the development and commercialization of proprietary NCE pharmaceuticals for the global marketplace. The company's business model merges traditional high-value markets in the West with the higher volume business models of emerging and developing economies. Napo's discovery process is based on the knowledge of traditional healers, or shamans, working in rainforest areas and provides benefit sharing to the communities with which it works. Visit Napo at www.napopharma.com.
Richard C. Auletta
SOURCE Napo Pharmaceuticals, Inc.
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