Shares of Pernix Therapeutics Holdings Inc (NASDAQ:PTX) tumbled nearly 17% this morning after investors learned that a Pernix and GSK had been in arbitration regarding claims related to the Treximet asset purchase agreement and supply agreement. On January 31, 2017, the arbitration tribunal issued opinions in favor of GSK, awarding it damages and fees in the amount of approximately $35 million, plus interest (estimated to be approximately $2 to $5 million). The tribunal also denied Pernix’s claim that GSK breached its obligations under the supply agreement. Pernix has already paid to GSK, or into an escrow account, an aggregate of $16.5 million, which will offset the total award. Pernix is reviewing the opinions, including the amount of interest, and intends to work with GSK to conclude the matter.
As of February 1, 2017, Pernix’s unaudited cash balance was approximately $26 million, after making the scheduled payment of interest and principal in respect of its Treximet secured notes on such date.
Pernix will continue to focus on improved performance, driven by commercial execution, the acquisition, development and commercialization of prescription products, and operational efficiency. The Company will also continue to analyze various alternatives in order to proactively address its liquidity and capital structure in a constructive manner, including strategic and refinancing alternatives, asset sales, and mergers and acquisitions.
Pernix Therapeutics Holdings, Inc. engages in the research, development, and manufacture of biopharmaceutical products. It focuses on therapeutics for diseases on central nervous system, neurology, pain, and psychiatry. Its products include treatment of migraine pain and inflammation, insomnia, and depressive disorder. The firm distributes its products under the following brands: Treximet, Silenor, Zohydro ER with BeadTek, and Khedezla. The company was founded on March 9, 2010 and is headquartered in The Woodlands, TX.