Elan Crowns King in Aribtration

King will pay out $49 million in a development dispute.
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King Pharmaceuticals (KG) said an arbitration panel ordered it to pay Elan (ELN) $49.8 million plus interest in a dispute over an insomnia drug.

Bristol, Tenn.-based King said the dispute centered on King's June 2003 acquisition of Elan's U.S. primary care business. Sonata was one of the drugs included in the deal.

King said it told Elan in 2005 that it considered the companies Sonata development agreement terminated "for failure to satisfy the target product profile required by King." Elan disagreed and started the binding arbitration that resulted in Friday's ruling.