After being accused of not doing enough to market the restless legs syndrome drug Horizant, GlaxoSmithKline is suing its partner XenoPort, while the latter has also filed a complaint.
The worsening in relations between the two firms stems from a month ago when XenoPort, in a filing with the US Securities and Exchange Commission, said GSK has “materially breached its contractual obligation to use commercially reasonable efforts to maximise the sales” of Horizant (gabapentin enacarbil) extended-release tablets “in an expeditious manner”. The drug was approved in the USA in April 2011 for the treatment of moderate-to-severe primary RLS in adults.
Horizant, which has received $120.0 million in milestones to date, says it is entitled to an additional $290.0 million upon the achievement of specified sales levels and claims it can now terminate its pact with GSK over a contract breach. The drugs giant took its time to respond but has now filed a complaint in the US District Court for Delaware.
GSK is seeking declaratory judgment that it is not in breach of the agreement and that XenoPort does not have the right to terminate the pact “as a result of GSK’s performance”. The US biotech responded by filing its own complaint in the Superior Court of the State of California against GSK for “breach of contract, fraud, breach of fiduciary duty, breach of the covenant of good faith and fair dealing and unfair competition”.
XenoPort is seeking damages for lost profits, damage to the value of its stock and unattained royalties and milestone payments in an amount to be proven at trial, as well as punitive damages and restitution.
