Watermark

Subsequent to a mediation ordered by the Supreme Court of Victoria late last week, Australian company, Biota Holdings Ltd has agreed to settle its legal proceedings with multinational pharmaceutical company GlaxoSmithKline for a payment of $20 million and wherein each party bears its own legal costs. This amount is considerably less than the $704 million damages that Biota was seeking from GlaxoSmithKline. 

In 1990 Biota licensed the patented anti-flu drug zanamivir (which is sold under the name Relenza) to GlaxoSmithKline.  In the proceedings Biota claimed that GlaxoSmithKline had breached its contract to adequately promote and market the drug, causing Biota the loss of millions of royalties.  Biota alleged that it was because of the lack of support from GlaxoSmithKline that Relenza is second in the market for preventative influenza treatments where the only other product Tamiflu from Roche is now dominant.

In coming to the settlement Biota chairman John Grant said that the board had taken some hard decisions after receiving advice following the May postponement of a scheduled trial date.  In particular, the “advice required us to review rigorously all aspects of the litigation in a new light including the impact of current and further possible delays and the growing scale and complexity of the litigation”.

Moving forward however, in a statement by Biota, the companies have “agreed to normalise their relationship to pursue the best interests of Relenza, with senior executive liason and co-operation between the companies to be strengthened.”

“The focus will be on developing the Relenza franchise, particularly in the important market of pre-pandemic influenza risk management.”