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Reuters New Media
India's Glenmark gets interim order vs. Napo

January 13, 2012
Reuters NewMedia - January 13, 2012

* Napo had terminated collaboration deal for diarrhoea drug * Order prevents Napo from terminating pact pending arbitration * Glenmark shares up more than 2 pct MUMBAI, Jan 13 (Reuters) - India's Glenmark Pharmaceuticals Ltd said on Friday it had received an interim order from a U.S. arbitration panel against U.S.-based Napo Pharamaceuticals Inc's termination of a collaboration pact for an HIV-associated diarrhoea drug.

The pact, signed in July 2005, had conferred exclusive rights to Glenmark to develop, commercialize and distribute the drug, Crofelemer, in 140 countries.

The move provides interim relief to Glenmark, which recently started trials of the drug to treat cases of adult acute diarrhoea, including cholera.

The arbitration panel will hold its next hearing by the end of March, Glenmark said.

Napo terminated the pact on Nov. 10, after which Glenmark sought an arbitration.

Glenmark developed Crofelemer with Napo and U.S.-based Salix Pharmaceuticals Ltd. Napo was the initial developer of the molecule and licensed it out to Glenmark and Salix.

According to the licensing agreement, Salix would sell the drug in regulated markets such as North America, Japan and Europe and Glenmark would sell it in 140 other countries.

Glenmark shares, which rose as much as 2.6 percent on the news, were trading 1.81 percent higher at 309.60 at 1:01 p.m. (0731 GMT). The overall market was up 1.04 percent.