PALO ALTO, Calif. - Scilex Holding Company (NASDAQ:SCLX), specializing in non-opioid pain management, and its subsidiary Scilex Pharmaceuticals Inc., along with Sorrento Therapeutics (OTC:SRNEQ), Inc., have reached a preliminary settlement agreement with Virpax Pharmaceuticals, Inc.
The agreement, announced today, is set to resolve disputes stemming from a lawsuit filed against Anthony Mack, former President of Scilex Pharma and founder of Virpax.
Under the terms of the settlement, Virpax has agreed to make a series of payments to Scilex, starting with an initial sum of $3.5 million due by March 1, 2024. A second payment of $2.5 million is scheduled for July 1, 2024. Additionally, Virpax will pay royalties of 6% on annual net sales of three drug candidates—Epoladerm, Probudur, and Envelta—if they are sold. These royalties will continue until the expiration of the relevant patents or regulatory exclusivity periods in each country.
Both parties have agreed to mutual releases of all claims up to the date of the settlement term sheet execution, with Scilex and Sorrento’s release limited to claims against Virpax only. The ongoing litigation against Mr. Mack remains unaffected by this settlement. The release of claims by the plaintiffs is contingent upon the receipt of the initial payment from Virpax.
The definitive settlement agreement is expected to be finalized by or before March 1, 2024. Should the parties fail to enter into a definitive agreement by this date, the term sheet will be binding and enforceable regarding the outlined terms.
Scilex Holding Company focuses on developing and commercializing non-opioid treatments for acute and chronic pain. Its marketed products include ZTlido for neuropathic pain associated with postherpetic neuralgia, ELYXYB for acute migraine treatment, and GLOPERBA for gout flare prophylaxis. The company is also advancing a pipeline of candidates targeting various pain conditions.
This settlement aims to conclude the legal dispute without further litigation, allowing Scilex to continue its mission of providing non-opioid pain management solutions. The information is based on a press release statement from Scilex Holding Company.
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