Diabetes player Novo Nordisk cut a deal this week, announcing a settlement agreement to put an end to a lawsuit filed in January 2017 by American Depository Receipt investors.
Settling outside of court is usually far more advantageous for big players than a long, drawn-out court battle. Diabetes player Novo Nordisk cut a deal this week, announcing a settlement agreement to end a lawsuit filed in January 2017 by American Depository Receipt investors.
With $100 million, Denmark’s insulin-maker hopes to quell the disquieted investors who initially demanded around $1.75 billion compensation for their losses. The suit was centered around allegations that Novo Nordisk led investors to believe its profitability was resistant to the mounting pressures around insulin pricing. The complaint was filed for compensation for losses sustained from February 2015 to February 2017.
Novo Nordisk was quick to clarify that the settlement is not an admission of liability or any wrongdoing on their part, but “is settling the lawsuit to avoid the burden, inherent risk and expense of further litigation.”
The $100 million is covered by the company’s insurance and will be distributed to the plaintiffs, including covering attorney fees and expenses.
“At Novo Nordisk, we take our responsibility to our shareholders seriously and remain committed to timely and accurate communication,” said Tomas Haagen, general counsel, Novo Nordisk. “While we are confident in the facts and merits of our position, we believe that resolving this matter is the right business decision for Novo Nordisk and our shareholders.”
Another legal filing against the Danish company was a whistleblower lawsuit filed in 2017, alleging illegal marketing and promotion of Novo Nordisk’s best-selling diabetes drug at the time, Victoza. With a $60 million payment, the company settled allegations of violation of the False Claims Act.
Also duking it out in court over the past few years were pharma giants Merck and Pfizer. In a heated battle over their competing pneumococcal conjugate vaccines, the past four years have found the two embroiled in extensive patent and infringement proceedings outside the U.S. The two have now decided to come to an agreement to bring the fight to end.
This January, the fight was brought to U.S. shores when Merck followed up its vaccine’s BLA filing with a complaint in the District Court of Delaware. Expecting an imminent lawsuit from Pfizer’s subsidiary Wyeth LLC, Merck asked for a declaratory judgment that its Vaxneuvance vaccine did not infringe on three patents for Wyeth’s Prevnar vaccines.
Merck said its filing was to “clear the way to deliver” its vaccine to U.S. patients by “lifting the threat of an imminent lawsuit by Wyeth.” The complaint accused Wyeth of an “aggressive pursuit of non-inventive and overly broad interpretations of its pneumococcal conjugate patents.”
As anticipated, Wyeth did follow up with its countersuit allegedly infringing on Prevnar patents in August after both companies won FDA approval for their vaccines. Pfizer’s Prevnar 20 crossed the finish line first with a June approval, while Merck’s Vaxneuvance won its approval a month later in July.
In negotiations, the companies have finally reached an agreement to end their legal woes. For the next five years, Merck will pay Pfizer 7.25% of net sales of all its PCV products. After that, Pfizer will continue to receive 2.5% of sales until 2035.
Merck believes its newly approved vaccine offers the first real alternative to Pfizer’s previous shot, Prevnar 13. It covers two additional strains of bacteria and demonstrated superiority to Prevnar 13 for several primary and secondary measures. However, Pfizer’s newest Prevnar 20 is a 20-valent, as the name suggests, for the prevention of invasive disease and pneumonia associated with 20 Streptococcus pneumoniae (pneumococcus) serotypes in adults.
The CDC is expected to provide recommendations on the use of both vaccines in adults in October.
