NEW YORK (TheStreet) -- SIGA Technologies (SIGA) plunged to a 52-week low of $1.62 on Monday after a Delaware court ruled the company must pay a lump sum in damages to PharmAthene (PIP) for the value of its lost profits from SIGA's smallpox vaccine Tecovirimat.
The court also demanded SIGA pay prejudgment interest and some percentages of PharmAthene's attorneys' and witness fees. SIGA announced that the award amount, which has not yet been determined, would be "substantial," but it intends to appeal the ruling. SIGA also said the damages would be based on U.S. government purchases of Tecovirimat "supposedly anticipated in 2006."
PharmAthene sued for a breach of contract in 2006. PharmAthene and SIGA had previously negotiated a merger, which would include a license for PharmAthene to SIGA's vaccine that would be negotiated on in good faith if the merger agreement fell apart. It did just that, and PharmAthene sued for a license on the vaccine and damages for lost profits.
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SIGA CEO Dr. Eric A. Rose said in a statement the company remains "committed to performing under SIGA's contract with" the government's Biomedical Advanced Research and Development Authority and obtaining Food and Drug Administration approval for Tecovirimat.
SIGA was down 35.4% to $1.77 at 3:29 p.m. More than 2.3 million shares had changed hands, compared to the average volume of 218,385.