ANNAPOLIS, Md., Jan. 7, 2015 /PRNewswire/ -- PharmAthene, Inc.
(NYSE MKT: PIP) announced today that the Delaware Court of Chancery has issued a letter
Opinion and Order directing PharmAthene to submit a Revised
Proposed Judgment that reflects a lump sum award of approximately
$113 million in contract expectation
damages, plus pre-judgment interest on that amount from 2006
through the date of the letter Opinion and Order, for the value of
PharmAthene's lost profits for SIGA's smallpox antiviral,
Tecovirimat. The total award when finalized, including
interest and reimbursement of a portion of PharmAthene's attorneys'
and expert witness fees, is estimated to be in excess of
$190 million.
The amount of the award remains subject to further calculation
and final approval by the Delaware
Court of Chancery, which determination, along with the decision
itself, will remain subject to appeal by SIGA to the Delaware
Supreme Court. Because SIGA has filed for protection under
the Federal bankruptcy laws, PharmAthene is automatically stayed
from taking any enforcement action in the Delaware Court of Chancery. Our ability to
collect a money judgment from SIGA remains subject to further
proceedings in the Bankruptcy Court.
A copy of the Court's opinions in the case, including the
present order, are available on the Company's website at
www.pharmathene.com under the "Investor Relations" tab.
About PharmAthene
PharmAthene is a biodefense company engaged in the development
and commercialization of next generation medical countermeasures
against biological and chemical threats. PharmAthene's current
biodefense portfolio includes the following product candidates:
- SparVax® - a next generation recombinant protective
antigen (rPA) anthrax vaccine (liquid and lyophilized
formulations)
- rBChE bioscavenger - a medical countermeasure for nerve agent
poisoning by organophosphorous compounds, including nerve gases and
pesticides
- Valortim® - a fully human monoclonal antibody for
the prevention and treatment of anthrax infection
In August 2014, the Delaware Court of Chancery issued a Memorandum
Opinion and Order and awarded to PharmAthene lump sum expectation
damages for the value of PharmAthene's lost profits for SIGA
Technologies, Inc.'s smallpox antiviral, Tecovirimat, also known as
ST-246® (formerly referred to as "Arestvyr™" and
referred to by SIGA in its Quarterly Report on Form 10-Q for the
quarterly period ended September 30,
2014 as "Tecovirimat"). In addition, the Court of Chancery
ordered SIGA to pay pre-judgment interest and varying percentages
of PharmAthene's reasonable attorneys' and expert witness
fees. A judgment, specifying the final damages amount and
fees payable to PharmAthene will be issued by the Court of Chancery
following the submissions described above and will remain subject
to appeal.
Forward-Looking Statement Disclaimer
Except for the historical information presented herein, matters
discussed may constitute forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995
that are subject to certain risks and uncertainties that could
cause actual results to differ materially from any future results,
performance or achievements expressed or implied by such
statements. Statements that are not historical facts, including
statements preceded by, followed by, or that include the
words "potential"; "believe"; "anticipate"; "intend"; "plan";
"expect"; "estimate"; "could"; "may"; "should"; "will"; "project";
"potential"; or similar statements are forward-looking statements.
PharmAthene disclaims any intent or obligation to update these
forward-looking statements other than as required by law. Risks and
uncertainties include risks associated with our interest in
Tecovirimat, also known as ST-246® (formerly referred to
as "Arestvyr™" and referred to by SIGA in its Quarterly Report on
Form 10-Q for the quarterly period ended September 30, 2014 as "Tecovirimat"); risks
associated with the reliability of the results of the studies
relating to human safety and possible adverse effects resulting
from the administration of any product candidates; funding delays
and/or reductions or elimination of U.S. government funding and/or
non-renewal of expiring funding for one or more of the Company's
development programs, such as BARDA's recent decision to de-scope
the current SparVax® anthrax vaccine contract through a
partial termination for convenience, or a decision by NIAID not to
exercise its options under our September
2014 contract after we receive funding of approximately
$5.2 million over the base period;
risks associated with our common stock, risks associated with the
GE Loan Agreement, risks associated with our net operating loss
carryforwards, or NOLs, risks associated with the award of
government contracts to our competitors or delays caused by third
parties challenging government contract awards to us; risks
associated with unforeseen safety and efficacy issues; risks
associated with challenges related to the development, technology
transfer, scale-up, and/or process validation of manufacturing
processes for our product candidates; risks associated with
unexpected determinations that these product candidates prove not
to be effective and/or capable of being marketed as products; risks
associated with accomplishing any future strategic acquisitions or
business combinations; and other risks detailed from time to time
in PharmAthene's Forms 10-K and 10-Q under the caption "Risk
Factors" and in its other reports filed with the U.S.
Securities and Exchange Commission. Further, at this point,
future government funding to support the development of
Valortim®, rBChE and SparVax® is
unlikely. Even if we received such funding, significant
additional non-clinical animal studies, human clinical trials, and
manufacturing development work remain to be completed for all
of our product candidates. In its August 2014 decision, the Delaware Court of Chancery awarded to
PharmAthene lump sum expectation damages for the value of
PharmAthene's lost profits for Tecovirimat. Although the
January 7, 2015 letter Opinion and
Order provides further guidance, the final amount of the award, and
in particular the calculation of interest, remains subject to
further calculation and approval by the Delaware Court of Chancery and there may be
further proceedings before the final amount is approved by the
Delaware Court of Chancery, which
determination, along with the decision itself, will remain subject
to appeal by SIGA to the Delaware Supreme Court. As a result,
the decision could be reversed, remanded or otherwise changed.
There can be no assurances if and when PharmAthene will receive any
payments from SIGA as a result of the decision. SIGA has
stated publicly that it does not currently have cash sufficient to
satisfy the potential award. Furthermore, because SIGA has filed
for protection under the federal bankruptcy laws, PharmAthene is
automatically stayed from taking any enforcement action in the
Delaware Court of Chancery. By
agreement of the parties, and with the approval of the Bankruptcy
Court, the automatic stay has been lifted for the sole purpose of
allowing the Delaware Court of
Chancery to enter a money judgment and to allow the parties to
exercise their appellate rights. Our ability to collect a money
judgment from SIGA remains subject to further proceedings in the
Bankruptcy Court.
Copies of PharmAthene's public disclosure filings are available
from its investor relations department and our website under the
investor relations tab at www.PharmAthene.com.
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SOURCE PharmAthene, Inc.