NKTR - Nektar reportedly sues Lilly for bungling clinical data on dermo drug

2023-08-07 13:29:20 ET

Nektar ( NASDAQ: NKTR ) is reportedly suing former partner Eli Lilly ( NYSE: LLY ) for allegedly miscalculating key clinical trial data for Nektar's dermatology and immunology drug candidate Rezpeg.

Nektar filed suit against Lilly in a federal court in San Francisco, accusing the drugmaker of breach of contract and unfair competition, amongst other allegations, according to a Reuters report.

Earlier Monday, Nektar accused Lilly of bungling data from two Phase 1b studies for Rezpeg in the treatment of atopic dermatitis and psoriasis. Nektar said that Lilly's calculations showed that patients with atopic dermatitis who took the drug at the highest dose for 12 weeks showed a 66% improvement in the severity of their condition versus a placebo. A recalculation by an independent statistical firm hired by Nektar showed the i mprovement rate was actually 83%.

Shares of Nektar rallied in the wake of the announcement. The stock was up 88% at $1 at around 1:00 p.m. ET on Monday.

Lilly had presented the allegedly miscalculated data at a medical conference in March. On April 27, Nektar announced Lilly had returned its rights to the drug.

San Francisco-based Nektar said it discovered the alleged miscalculations after Lilly ended their collaboration for the product and transferred the data to Nektar. Lilly has since confirmed the errors in writing, Nektar added.

Nektar said the new data bolsters its case for initiating a Phase 2b trial for Rezpeg in the treatment of  moderate-to-severe atopic dermatitis. The study is expected to begin in October.

In mid-April, Nektar announced a major restructuring of the company that included the reduction of its San Francisco workforce by around 60%. At the time, Nektar said it was prioritizing development of Rezpeg, even if Lilly were to return rights to the product.

Nektar is scheduled to release its Q2 earnings report Tuesday, after market close.

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Nektar Therapeutics CEO Howard Robin on Q3 2021 Results - Earnings Call Transcript

Nektar Therapeutics SEC Filing - Quarterly Report 10-Q May 09, 2023

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