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To: Jane4IceCream who wrote (208344)	9/22/2011 12:58:31 PM
From: joseffy	Read Replies (1) of 208838

PharmAthene Wins Rights to Profits in Siga Smallpox Drug .................................................................................................... By Sophia Pearson and Jef Feeley - Sep 22, 2011 http://www.bloomberg.com/news/2011-09-22/siga-loses-bid-to-deny-smallpox-drug-rights-to-pharmathene.html?cmpid=yhoo Siga Technologies Inc. (SIGA) must share with PharmAthene Inc. profits from sales of a smallpox drug that may be total more than $400 million, a judge ruled. Trading in shares of both companies was halted. Delaware Chancery Court Judge Donald Parsons Jr. in Wilmington said today New York-based Siga breached its obligation to negotiate in good faith on ST-246, an antiviral drug for use in case of a biological attack. Parsons rejected PharmAthene’s claim that Siga breached a binding license agreement. He also denied claims for a lump sum award and instead ordered the companies to share the profits. “The plaintiff is entitled to share in any profits realized from the sale of the drug in question,” Parsons said today in a 118-page opinion. PharmAthene executives sued Siga in 2006 claiming the biotech firm lost more than $1 billion in potential profits when its rival reneged on the licensing agreement for the smallpox drug. Government officials awarded Siga a $433 million contract to provide ST-246 to the U.S. Department of Health and Human Services, the company said in May. Lawyers for Siga argued at trial that licensing talks were never completed and documents outlining proposed terms were marked as “non-binding.” A PharmAthene official said in court that the heading was left on the documents by mistake. PharmAthene’s attorneys argued during a two-week trial in January that Siga was running out of money to develop ST-246 in late 2005 when it proposed a merger or license agreement. Ultimately Loaned PharmAthene executives ultimately loaned Siga $3 million to keep the drug’s development going while the two companies negotiated, according to court testimony. Company officials claimed that ex-Siga Chairman Donald G. Drapkin guaranteed the companies would either merge or Siga would grant PharmAthene a license for the medicine. Drapkin, a former executive of billionaire Ronald Perelman’s MacAndrews & Forbes holding company, countered during the trial that he never promised PharmAthene officials a license. A term sheet was intended to serve as a “jumping off point” for negotiations if merger talks faltered, Drapkin said. The case is PharmAthene Inc. (PIP) v. Siga Technologies Inc., CA2627, Delaware Chancery Court (Wilmington). To contact the reporters on this story: Sophia Pearson in Wilmington at spearson3@bloomberg.net; Jef Feeley in Wilmington, Delaware at jfeeley@bloomberg.net To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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