Novo Nordisk seeks US$830m over biotech fraud
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The news: Novo Nordisk is seeking up to USD830 million ($1.3 billion) in damages from KBP Biosciences arguing it was misled by the biotech about the effectiveness of an experimental drug.
The numbers: Novo paid as much as USD1.3 billion for the drug in 2023, and announced an impairment loss for USD5.7 billion after a clinical trial showed the treatment failing less than one year later.
The context: A ruling by Singapore’s International Commercial Court released this week says Novo claims it was misled into believing the defendants had developed “a new and effective drug to treat hypertension and kidney disease, Ocedurenone,” which it then acquired.
The Singapore court agreed to freeze the assets of KBP as well as its founder, Huang Zhenhua, and the matter will now proceed in New York.
What they said: Judge Philip Jeyaretnam said: “Arguably, KBP knowingly failed to disclose material information, including interim analyses of Phase 2 clinical trial results showing Ocedurenone’s inefficacy, and information concerning quality and compliance issues at a single test site that produced anomalous positive results. Likewise, Dr Huang arguably knew and participated in these misrepresentations. He was the founder, Executive Chairman and a 40% shareholder of KBP. There is a good arguable case that when Dr Huang executed the APA he did so conscious of the unfavourable data.”
The sources: Singapore Court Ruling, Bloomberg
