Forest Labs kills pact for Replidyne's antibiotic

Forest Laboratories has backed out of a deal with Replidyne for the development of a new antibiotic, faropenem medoxomil, four months after the FDA rejected the therapy. Replidyne says Forest made the move after reviewing data on the antibiotic and considering the consequences of the agency's decision. Replidyne plans to continue development work, but noted that the FDA's rejection raises uncertainties. A year ago Forest gave Replidyne $50 million up front and a promised schedule of milestones for its successful development. After the FDA's action, Replidyne's stock plunged 45 percent.

"We remain confident in the viability of faropenem," said Kenneth Collins, Replidyne's president and CEO. "Though the regulatory requirements for the approval of antibiotics have changed, we believe that faropenem can meet these new standards, and are we working closely with the FDA to define a regulatory pathway for faropenem approval."

- see the release on the decision
- read the report on Replidyne from TheStreet.com