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Nuvo Research Announces Lawsuit Against Mallinckrodt

By Pharmaceutical Processing | August 21, 2013

Nuvo Research Inc. (Nuvo), a specialty pharmaceutical company dedicated to building a portfolio of products for the topical treatment of pain and the development of its immune modulating drug candidate WF10 today announced that the Company has commenced legal action against Mallinckrodt Inc. (Mallinckrodt) by filing a Complaint in the United States District Court for the Southern District of New York. The Complaint asserts that Mallinckrodt has breached its contractual obligations to Nuvo as set out in a Licensing Agreement dated June 15, 2009 (License Agreement) pursuant to which Nuvo licensed to Mallinckrodt the rights to market and sell Pennsaid and Pennsaid 2% in the United States. 

The Complaint asserts that Mallinckrodt breached the License Agreement in several respects.  Most significantly, Mallinckrodt willfully failed to conduct certain clinical studies required under the contract that are critical to regulatory approval, marketing and sales of Pennsaid 2% throughout the world.  The Complaint also alleges, amongst other things, that Mallinckrodt made significant errors in certain clinical studies for which it was responsible, failed to apply requisite efforts to commercialize Pennsaid in the United States and has willfully refused to pay the full milestone payments due to Nuvo under the License Agreement.  Nuvo is seeking damages of not less than $100 million and a declaration that it is entitled to terminate the License Agreement which would result in the rights to market and sell Pennsaid and/or Pennsaid 2% in the United States reverting to Nuvo. 

Nuvo has not terminated the License Agreement which continues in accordance with its terms pending the Court’s decision. A complete copy of the Complaint can be viewed at www.nuvoresearch.com. “We are disappointed that we have had to initiate legal proceedings against Mallinckrodt,” said John London, Nuvo’s President and Co-CEO. “Our board has not taken this decision lightly.  However, given what we believe are clear material breaches of the License Agreement and Mallinckrodt’s refusal to consider appropriate and fair compensation to Nuvo, we have proceeded with legal action to protect the interests of Nuvo and its shareholders.”

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