Medicis Shares Fall After Disclosure of Q-Med AB Lawsuit
Medicis Pharmaceutical Corp. fell as much as much as 7.7 percent, its biggest drop since Aug. 9, after the dermatological-drug company said it was sued by Q-Med AB to block transfer of rights to its wrinkle gel Restylane to a competitor.
Q-Med filed the lawsuit, which it described in court papers as “an action in aid of arbitration,” in federal court in Manhattan on Nov. 7. Medicis disclosed Q-Med’s lawsuit in a regulatory filing today.
Medicis in September said it had agreed to be acquired by Montreal-based Valeant Pharmaceuticals International Inc. (VRX) in a transaction valued at $2.6 billion. In court filings, Q-Med described Valeant as its “direct competitor.”
“Q-Med has informed Medicis that it will not consent to a change of control of Medicis that would result in a transfer to Valeant of the exclusive rights to market and sell Q-Med’s dermal filler products” including Restylane in North America, the Uppsala, Sweden-based company said in a filing.
Asserting it will sustain “irreparable harm” if those rights are transferred while arbitration is pending, Q-Med asked for a court order temporarily blocking the transaction.
U.S. District Judge Richard J. Sullivan ordered Medicis to respond to the injunction request by Nov. 14 and scheduled oral argument for Dec. 3.
Kara Stancell, a spokeswoman for Scottsdale, Arizona-based Medicis, declined to comment on the suit.
While Valeant isn’t named as a defendant in the case, the company assailed Q-Med’s claims in an e-mailed statement.
“Not only does Q-Med have no entitlement to the injunctive relief it seeks, but its request for such an extreme remedy is predicated on a systematic misreading of its contracts with Medicis,” according to the Valeant statement.
Medicis closed $42.03, a 3.04 percent decline in trading in New York after having fallen as low as $40 at 12:28 p.m.
The case is Q-Med AB v. HA North American Sales AB, 12-cv-08071, U.S. District Court, Southern District of New York (Manhattan).
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