Item 8.01 Other Events
On June 16, 2023, Cumberland Pharmaceuticals Inc. (the "Company") received
consideration related to the breach of contract action with Melinta
Therapeutics, LLC and Targanta Therapeutics Corporation (collectively, the
"Defendants") that finalized a settlement agreement that was entered into by the
Company and the Defendants to close the case.
On February 2, 2022, the Company filed an action for breach of contract against
the Defendants in the United States District Court for the Southern District of
New York (Case No. 1:22-cv-00915-VM). The Company and the Defendants are parties
to an agreement (the "Agreement"), pursuant to which the Defendants have a
license to develop and commercialize products under certain Company patents, in
exchange for the Defendants paying the Company certain milestone payments and
royalties on net sales of the licensed products.
Specifically, the Agreement requires the Defendants to, among other things, make
a $500,000 payment to the Company within 30 days following the first filing of
an sNDA in relation to the Product (as defined the Agreement) and a $500,000
payment to the Company following the approval of the first sNDA in relation to
the Product.
After Defendants disclosed the domiciles of its limited partners to the Company,
as required by the Court, on October 24, 2022, the action for breach of contract
was refiled in the Supreme Court of the State of New York, County of New York
(Index No. 654234/2022) on November 7, 2022.
The complaint alleged that, despite the Defendants filing an NDA and sNDA for
the Product and receiving FDA approval for both applications, the Defendants
failed to make the required total of $1 million in milestone payments to the
Company. The Company sought damages in the amount of no less than $1 million,
pre- and post-judgment interest under N.Y. C.P.L.R. § 5001, costs, and such
further relief as the court deems just and proper.
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