A Diagnostics & Imaging Week
Advanced Magnetics (Cambridge, Massachusetts) said that it has settled the lawsuit filed against it by Cytogen (Princeton, New Jersey), the parties agreeing to a dismissal and dropping all claims against each other.
Advanced Magnetics and Cytogen agreed to terminate immediately both the license and marketing agreement and the supply agreement between them.
Advanced Magnetics will pay Cytogen $4 million in cash and release to Cytogen the 50,000 shares of Cytogen common stock being held in escrow under the terms of the original license and marketing agreement.
Cytogen last year filed suit vs. Advanced Magnetics, alleging breach of contract, breach of implied covenant of good faith and fair dealing, fraudulent misrepresentation and unjust enrichment related to a license and marketing agreement entered into in August 2000 in which Advanced Magnetics granted Cytogen certain rights to Combidex and to ferumoxytol for oncology imaging applications.
At the time, Advanced Magnetics said that the lawsuit had no merit and that it would not "materially distract" it from bringing ferumoxytol "as an intravenous iron replacement therapeutic and Combidex as an MRI contrast agent to market."
Both companies were hurt when an FDA panel recommended against the approval of Combidex, Advanced Magnetics' investigational molecular imaging agent consisting of iron oxide nanoparticles for use in conjunction with MRI to aid in differentiating cancerous from normal lymph nodes. That thumbs-down damaged shares of Advanced Magnetics by two-thirds and halved the stock of Cytogen.
In its decision, the agency's Oncologic Drugs Advisory Committee cited insufficient clinical data for the product and voted 15-4 against supporting a broad indication for Combidex.
Advanced Magnetics said it now has re-acquired the U.S. marketing rights to Combidex, as well as the U.S. marketing rights to ferumoxytol for oncology imaging applications.
Brian Pereira, president/CEO of Advanced Magnetics, said, "We look forward to advancing our development programs for both ferumoxytol as an intravenous iron replacement therapeutic and Combidex as an imaging agent in the months ahead."
Advanced Magnetics develops super-paramagnetic iron oxide nanoparticles used in pharmaceutical products and imaging. Cytogen is a developer of imaging agents.