Indian generics giant Dr. Reddy's Laboratories ($RDY) has wrapped up its lawsuit against Nordion ($NDZ), agreeing to a $22.5 million settlement with the former CRO.
The spat arises from a series of FDA citations Nordion, then MDS, received while it was conducting lab services for Dr. Reddy's. The CRO's problems led the FDA to reject its data from 2000 to 2004, covering some generics Dr. Reddy's was trying to get on the market in the U.S.
The FDA chided Nordion for failing to meet good laboratory practices while carrying out bio-equivalency studies for Dr. Reddy's, and the Indian drugmaker filed suit in 2009 claiming breach of contract.
In the initial suit, Dr. Reddy's claimed repeat study and mitigation costs of $10 million and lost profits of $70 million, and Nordion says the $22.5 million final payout will be covered mostly by insurance, resulting in a net loss of $1.4 million for the Canadian company.
Nordion got out of the CRO business back in 2010, divesting its MDS Pharma Services business and focusing instead on targeted therapies, sterilization technologies and medical isotopes.
- read Dr. Reddy's statement
- here's Nordion's take