PharmAthene Declares Special Cash Dividend

Shares of PharmAthene (PIP) were up 6% Friday morning after the biodefense company yesterday afternoon declared a special one-time cash dividend of $2.91 a share.

PharmAthene shares were trading at $3.03, giving the company a market capitalization of $201.6 million.

Annapolis, Md.-based PharmAthene is a developer of Anthrax vaccines.

The dividend is payable on Feb. 3, 2017 to holders of record as of Jan. 24, 2017. The dividend payment totals around $200 million and translates to approximately 98% of the after-tax net cash proceeds PharmAthene received from biodefense drug company Siga Technologies Inc. in connection with a drug license dispute.

The dividend announcement came a day after PharmAthene said it had received a final payment of $83.9 million from Siga. PharmAthene received a total of about $217 million including interest from Siga.

PharmAthene sued Siga in December 2006 over a license for Siga's drug candidate, Tecovirimat. In August 2014, the Delaware Court of Chancery ruled that Siga had failed to negotiate in good faith with PharmAthene in relation to the license. Siga filed for Chapter 11 protection in September 2014 to ensure it could satisfy its commitment to provide Tecovirimat, an antiviral smallpox drug, to a strategic stockpile started by the U.S. government. In January 2015, the Delaware Court of Chancery ruled that Siga owes PharmAthene more than $190 million in damages. Siga appealed the judgment to the Delaware Supreme Court, which affirmed the judgment in December. Siga emerged from Chapter 11 bankruptcy protection in April of this year.

During the third quarter, PharmAthene recognized revenue of $1 million, compared to $1.2 million in the year-ago period. The company reported net income of $109.2 million for the quarter, compared with a net loss of $1.3 million in the third quarter of 2015.

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