Saturday, March 14, 2015

Medafor Injunction Holds Up US Perclot Topical

CryoLife, Inc. (NYSE: CRY), a leading medical device and tissue processing company focused on cardiac and vascular surgery, today provided an update on its ongoing litigation with C.R. Bard, Inc. and certain of its subsidiaries regarding PerClot. The U.S. District Court for the District of Delaware (the "Court") has allowed CryoLife's declaratory judgment lawsuit against C.R. Bard's Medafor, Inc. subsidiary ("Medafor") to proceed. The Court also granted Medafor's motion for a preliminary injunction with respect to CryoLife's marketing and sale of PerClot Topical in the U.S. CryoLife is currently awaiting the Court's order, which it expects will provide details regarding the scope of the injunction.
Pat Mackin, CryoLife President and Chief Executive Officer, said, "While we are disappointed with the District Court's ruling on the preliminary injunction motion, we continue to believe we have a strong case and remain focused on securing the best long-term outcome in the litigation for our shareholders. We remain on track to begin enrollment in our PerClot IDE clinical trial for surgical applications during the first half of 2015, which would position us for potential FDA approval in the second half of 2017."
In April 2014, CryoLife filed a declaratory judgment lawsuit against C.R. Bard and certain of its subsidiaries, including Medafor, requesting that the Court declare that CryoLife's manufacture, use, offer for sale, and sale of PerClot in the U.S. does not and would not infringe Medafor's U.S. Patent No. 6,060,461 (the "'461 Patent"). In addition CryoLife requested that the Court declare that the claims of the '461 Patent are invalid. In September 2014, Medafor filed a motion for a preliminary injunction against CryoLife.
The preliminary injunction applies to PerClot Topical, which is in the early stages of launch in the U.S. CryoLife included approximately$1.5 million in PerClot Topical sales in its previously announced 2015 financial guidance. At this low-volume level, the Company was anticipating the gross margin for PerClot Topical to be approximately breakeven. The Company's previously announced earnings per share guidance for 2015 included $3 million to $4 million in expense related to the litigation with C.R. Bard. The Company continues to expect that this represents the high end of potential litigation expenses for the year related to this matter, and it will re-assess its litigation strategy and provide appropriate updates to its financial guidance, if any, after receiving the Court's order.
See official papers below....

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