Court denies motion to dismiss Vision Pharma's claims in contract dispute

By Marian Johns | May 8, 2019

FORT MYERS — An Iowa-based pharmaceutical company's effort to dismiss a complaint by Vision Pharma in a dispute over a product supply agreement has been struck down by a federal court. 

According to the April 9 U.S. District Court for the Middle District of Florida Fort Meyers Division filing, defendant Sterling Pharmaceutical Services LLC petitioned the court to dismiss a second amended compliant filed by Florida-based Vision Pharma.

The case involves a dispute over a product supply agreement (PDA) between Sterling and Vision in which Sterling would serve as a contract manufacturing organization (CMO) for Vision and included the manufacturing of Carisoprodol tablets and OTC diphenhydramine carbonated liquid products. Part of the agreement, according to the court filing, included Sterling providing data and other material to help Vision submit an abbreviated new drug application (ANDA) in order to obtain FDA approval. 

Vision argues that even though Sterling repeatedly agreed in "various communications" to provide the information needed for the ANDAs set to specific deadlines, the company failed to provide documents, updated formulas and other data.  Vision also alleges that even when Sterling did provide some documentation, the data was incomplete, did not have the proper signatures and contained apparently incorrect figures. 

Vision also says Sterling's actions caused it to miss an FDA deadline that resulted in Vision not being able to launch its drugs and causing the company to miss the "opportunity to be the first to market" for one of their drugs. The company also alleges it spent "millions of dollars" on the drugs and seeks recovery for its losses. 

Sterling argues the court lacks subject-matter jurisdiction because Vision did not "address the deficiencies" the court identified "regarding the requisite amount in controversy" and that Vision pleads only "speculative and indeterminate damages."

U.S. District Judge Sheri Polster Chappel said the court agreed with the plaintiffs on counts of breach of contract,  breach of implied covenant of good faith and fair dealing, and promissory estoppel but disagreed with the plaintiff's count of breach of warranty.  Polster Chappel concluded the court would deny Sterling's motion to dismiss. 

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