Here is the Who’s Who of Pharmaceutical Lawsuits

The development of pharmaceuticals is a high stakes game. Not only are millions or billions of dollars invested in their development, but the consequences that result from a drug that has unexpected side effects can hurt both a company’s reputation and its profitability. With such high-cost factors at play, lawsuits come along quite frequently.

Here are two cases affecting the healthcare industry now:

Eli Lilly puts cancer charges to rest

Shortly after it began in a Boston federal courtroom, a lawsuit brought by four Pennsylvania sisters against the drugmaker Eli Lilly (NYSE:LLY) came to a close. It took only several days and one witness for the company to decide to offer a settlement for an undisclosed amount. The sisters argued that the drug diethylstilbestrol, taken by their mother when she was pregnant, caused all four women to have breast cancer. DES, a synthetic form of estrogen that was prescribed to millions of women to prevent miscarriages between the late 1930s and early 1970s, was taken off the market after being shown to cause rare forms of cancer in women.

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The settlement was reached on Thursday following the testimony of a Harvard public health doctor who gave evidence that DES has been shown to cause cancer.

“While we continue to ­believe that Lilly’s medication did not cause the conditions ­alleged in the lawsuit, we believe the settlement is in the best interest of the company,” said the company in a statement seen by The Boston Globe. “Settling this trial helps us get back to what we want to focus on as a company; developing important new medications through research and partnerships with doctors and patients.”

PharmAthene and Siga Technologies’s on-going litigation

The trial involving the biopharmaceutical companies PharmAthene (NYSEAMEX:PIP) and Siga Technologies (NASDAQ:SIGA), both of which develop treatments for viruses used in biological warfare, emerged from a dispute over a lucrative government contract dating back to 2006.

PharmAthene claimed that Siga executives had guaranteed that it would be given manufacturing rights to Siga’s smallpox antiviral treatment, Arestvyr. While the pharmaceutical company claimed that a licensing agreement for the drug had been drafted, Siga has maintained that the discussions were never completed and the document was labeled “non-binding.” But in May of last year, a Delaware court ruled in favor of PharmAthene, awarding the company 50 percent of all Arestvyr sale proceeds for a period of ten years, beginning once Siga’s profits from the drug surpass $40 million.

Siga appealed the ruling, and the Delaware Supreme Court began hearing oral arguments for the case on Thursday.

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