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  • toobig2failagain toobig2failagain May 26, 2013 1:57 PM Flag

    PIP Wins Worldwide Licensing Rights

    The Delaware Supreme Court clarified the following for the lower court:

    1) SIGA was definitely liable for a "breach of contract" and liable for expectation damages due to their intentional negotiation in "bad faith".

    2) They stated that the "promissory estoppel" doctrine could not be applied due to the fact that the LATS was found by them to be an enforceable legal contract. Since "promissory estoppel" could only be applied to non-binding contracts, Parsons erred in applying this principle in applying the 50-50 split.

    3) However, due to the fact that the LATS is enforceable, the Supreme Court directs Parsons (the lower court) to assess expectation damages based upon the LATS agreement, which should be considered to be a "binding" contract.

    4) The LATS agreement states that Pharmathene (PIP) would own worldwide licensing rights to sell the drug as long as an initial $6 million were to be paid to SIGA up-front, another $10 million after certain events occurred (including FDA approval of the drug), and payments of licensing percentages were paid to SIGA for the sale of the drug (I believe, 10-12 percent, based upon sales volume). PIP also had the right to produce the drug with the assistance of SIGA. In other words, PIP gets to keep 88-90 percent of all sales of the drug sold by PIP, and SIGA gets 10-12 percent of the sales.

    5) Expectation damages awarded to PIP in the form of cash will probably be minimal ($10 - $300 million), but the LATS agreement will definitely be enforced. PIP already has the prod capacity to produce 200 - 300 million doses per year for worldwide distribution.

    Sentiment: Buy

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    • If your scenario ends up being the case, SIGA will shut the doors and turn off the lights. Don't think the judges don't know what circumstances are in the balance. If they totally screw over SIGA there will be no reason to fill the orders. SIGA will fold....That is not going to happen. There is enough ridiculous BS going on in Washington, the judge will end this quickly and let the Gov't get on with their business....without the cockroaches from PIP....

    • You are a frigging IDIOT!!!

 
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