A brewing wrangle between St. Louis-based KV Pharmaceutical ($KV.A) and former chief executive Marc Hermelin has erupted into a bitter public dispute with the company's lawsuit attempting to eliminate $37 million it could owe on retirement benefits and collect on a long litany of items, including part of Hermelin's pay.
The dispute between KV and Hermelin dates back to late 2008, when an internal investigation concluded that Hermelin had not acted in the company's best interest. Soon afterwards, the FDA stepped in to shutter KV's pharma business after regulators concluded that the company was shipping over-sized morphine pills, according to a report in STLtoday.
Last fall Hermelin resigned from KV's board after he was barred from participating in any federal health programs and last March he pled guilty to criminal misdemeanor charges of mislabeling drugs. He served half of a 30-day sentence.
Therefore, Hermelin says he had resigned and is owed millions in retirement and severance pay. The company says it owes him nothing, and also wants the ex-chief to repay the salary he was given during the time he was not working in KV's best interest.
KV has been at the center of several controversies in recent years. Most recently it found itself in the spotlight after it gained approval for a drug to prevent premature births which bares a close resemblance to a compounded drug that could be obtained at only a fraction of KV's treatment. KV's shares gained a few days ago when a physician group noted differences between the approved therapy and the compounded drug, adding that doctors should be free to pick between the two.
- here's the story from stltoday.com