Lonza spat with Altus over manufacturing deal escalates
pharmafile | July 1, 2009 | News story | Manufacturing and Production |Â Â LonzaÂ
Altus Therapeutics has officially called a halt to a supply agreement with contract manufacturer Lonza in the latest round of a legal dispute between the two firms.
The row broke came to a head in May after Altus decided to terminate development of its Trizytek (ALTU-135 or liprotamase), an enzyme replacement therapy for patients suffering from malabsorption due to exocrine pancreatic insufficiency.
It took the decision in the wake of a phase III trial which, while meeting the primary endpoint, was less compelling than the company had hoped for.
The US company accompanied this news with a 75% reduction in headcount and a re-focusing of its development activities on once-weekly growth hormone treatment ALTU-238, currently in phase II.
Lonza had been manufacturing quantities of the active pharmaceutical ingredient in Trizytek under an agreement between the companies signed in 2006.
The first signs of discontent were evident back in March, when Lonza notified Altus that it considered the firm had terminated the manufacturing contract without notice. Altus maintains that it notified the Swiss CMO of its intention to terminate the contract on 27 March.
It followed this with a legal challenge in May, designed to recover termination costs estimated at around $7.6 million, less the cost of any APIs supplied to date, according to an Altus regulatory filing with the Securities & Exchange Commission.
In retaliation, Altus has accused Lonza of a breach of contract and "failure to meet the requirements of the Agreement with respect to the production of validation batches of the APIs for Trizytek."
According to Altus' latest quarterly statement, the firm had $25 million in cash, cash equivalents and short-term marketable securities at the end of March.
Ongoing restructuring costs means that is likely only enough to see Altus "into the third quarter of 2009" it said, adding that it would have to raise "significant additional funding" to remain a going concern.
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