Commercial reasonableness opinion in jury verdict for Salix Pharmaceuticals

CRA provided analyses on behalf of Salix Pharmaceuticals, in a litigation matter in which a New York State Supreme Court jury entered a verdict in favor of Salix. The jury rejected all of Napo Pharmaceuticals’ breach of contract claims related to Fulyzaq™ (crofelemer).

In December 2008, Salix licensed the rights to crofelemer from Napo, agreeing to use commercially reasonable efforts to develop and commercialize crofelemer, a therapy for HIV/AIDS-related diarrhea that later would be approved on December 31, 2012 and marketed under the name Fulyzaq. In May 2011, Napo sued Salix claiming that the company had breached the parties’ agreement by failing to use commercially reasonable efforts. Napo sought more than $260 million in damages and the right to terminate the parties’ agreement and take back from Salix the rights to the drug.

CRA was retained by Covington & Burling, counsel to Salix, and prepared several analyses that were relied upon during the trial proceedings. In addition to assessing the development and commercialization efforts invested in Fulyzaq, CRA performed financial and cohort analyses that evaluated the extent and timing of efforts related to Fulyzaq. Dr. Gregory K. Bell, a Group Vice President and Life Sciences Practice Leader at CRA, testified on behalf of Salix at the trial as to commercially reasonable efforts supporting the launch of Fulyzaq.

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