In December last year, Spectrum Pharmaceuticals initiated an arbitration proceeding with the American Arbitration Association to resolve a dispute between the companies in regards to the co-development and license agreement for satraplatin, a drug being developed to treat hormone-refractory prostate cancer.
GPC Biotech announced yesterday a three-arbitrator panel had unanimously rejected all of Spectrum's claims and found no violations of the agreement by GPC Biotech.
"GPC Biotech takes its contractual obligations to its partners very seriously. We are pleased that the panel unanimously agreed that all of Spectrum's allegations were without merit and that we committed no violations of the agreement," GPC Biotech chief executive Bernd Seizinger said in a statement.
Spectrum filed the arbitration claim in "response to GPC Biotech's intentional and bad faith exclusion of Spectrum from its rightful participation in sublicense fee income received by GPC Biotech, and to other non-monetary violations of the license agreement", the US-based company said in a statement last year.
Spectrum made several claims of a breach of contract including an assertion that it was entitled to a payment from GPC Biotech of approximately €9m ($13m) relating to payments GPC Biotech received from Pharmion under the co-development and license agreement between the two companies. The claim also extended to payments GPC Biotech was entitled to from Yakult Honsha under the license agreement for Japan.
Said Spectrum in its statement last year: "GPC Biotech wilfully and materially breached the License Agreement and the implied covenant of good faith and fair dealing by structuring its co-development and license agreement with Pharmion GmbH to evade financial obligations owed to Spectrum under the license agreement."
Spectrum also claimed GPC Biotech had not used commercially reasonable efforts to obtain regulatory approval and to promote the distribution of satraplatin in Japan, and that GPC Biotech had not negotiated with Spectrum in good faith regarding the co-promotion of satraplatin in the US.
Had GPC Biotech been found to breach the contract, Spectrum was also seeking for a termination of the license agreement and for GPC Biotech to transfer all satraplatin rights to Spectrum, including the sublicense agreement.
At the time of the filing last year, Seizinger had said the claims were "made in bad faith and are completely baseless and without merit".
The arbitration panel found that Spectrum was not entitled to any payments, it did not have a contractual right to co-promote satraplatin in the US, GPC Biotech did not violate any obligation to negotiate in good faith a co-promotion agreement and GPC Biotech did not violate its obligation to use commercially reasonable efforts to commercialise satraplatin in Japan.
A spokesperson from Spectrum was unavailable for comment at time of publishing.
Although the panel ruled for GPC Biotech on the merits, it did not award the company re-imbursement of attorney's fees and costs.
GPC Biotech has been fighting an uphill battle with satraplatin, a third generation oral platinum compound.
Last week, the company announced disappointing Phase III results which showed there was no difference between the satraplatin arm and the control arm. This followed the pulling of the New Drug Application in the US at the end of July after a less than glowing recommendation to the US Food and Drug Administration that it hold off on approving the drug.
Despite the setbacks, the company has remained confident about the future of the drug.
