Australia’s Biota Holdings has this week revealed it is seeking damages between A$308-430 million (US$234-326 million) against GlaxoSmithKline, claiming that the UK giant failed to sufficiently promote and support its oral flu drug Relenza (zanamivir).

The so-called ‘particulars of loss and damage’ were lodged with the Victorian Supreme Court and outline the firm’s assessment of the value of lost royalties to Biota following GSK’s withdrawal of support for Relenza. This issue first came to light last year, after what the Australian company deemed two years of “unsatisfactory” discussions with GSK [[06/05/04d]]

The drug, a neuraminidase inhibitor that works in the lungs to block a virus that causes influenza, was launched globally in 1999 and 2000. However, in 2001, GSK's chief executive Jean-Pierre Garnier dismissed Relenza as a non-priority product after poor sales results [[25/04/01a]]. In its statement last year, Biota claimed Relenza was "effectively abandoned at birth" and, having captured some 50% of the $330 million global market for flu drugs, saw this whittled away to just 3% over the following years. Biota is entitled to receive 7% of GSK’s sales for Relenza.

And, since the suit was filed in May 2004, Biota says the prescription market for Relenza's class of flu antivirals has grown by more than 70% to around US$500 million, on top of a similar growth the previous year, helped by high levels of stockpiling of influenza antivirals to meet the growing threat of pandemic flu. Current and future orders are forecast to result in around US$3 billion in sales over the next two years, but Relenza now holds just 1% of the global market.

Specifically, Biota is claiming that GSK not only failed to promote and support Relenza, but that it failed to maintain adequate stocks to meet demand, to pursue a flu prevention claim, to conduct certain post-marketing studies, or to develop a commercially suitable inhaler device for the product.

The assessment lodged with the Court refers to a conservative market growth scenario, which assesses damages at A$308 million, and a moderate market growth scenario, which assesses the damages at A$430 million. Both scenarios assume that Relenza would have achieved a 40% market share and that GSK would have introduced an inhalation device and pursued regulatory approval for the prevention of influenza as well as treatment.

Biota said it could still revise its claim, with mediation of the dispute scheduled for November.