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(Sharecast News) - Clinical-stage biopharmaceutical company Faron Pharmaceuticals announced on Monday that, further to the update on 'Traumakine' drug substance manufacturing on 2 October, it has carried out a detailed investigation into the circumstances around manufacturing arrangements.
The AIM-traded firm said it had concluded that it considered the letter in which Rentschler Biopharma stated that it was terminating the agreement concerning the API manufacturing process for Traumakine to be "without merit and in breach of the underlying agreement" between the parties.
Faron said it also considered Rentschler to have otherwise breached the agreement.
"As a remedy, the company has filed a request for arbitration with the Arbitration Institute of the Stockholm Chamber of Commerce seeking damages," the board said in its statement.
"To fund the proceedings, the company has entered into a litigation funding agreement with a third-party recovery services provider offering non-recourse financing which, subject to final quantum, is expected to cover both the company's legal expenses and the adverse party costs.
"The funder would receive a typical portion of any damages awarded in the event of success."
Faron Pharma said further updates would be provided in due course, as and when appropriate.
At 1532 GMT, shares in Faron Pharmaceuticals were down 2.75% at 265.5p.
13 Jun 2016 08:18