Akebia falls as agreement with Otsuka Pharma ends

May 16, 2022 7:21 AM ETAkebia Therapeutics, Inc. (AKBA)By: Dulan Lokuwithana, SA News Editor

Deal is broken. Bad not secure deal

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Akebia Therapeutics (NASDAQ:AKBA) has lost ~18% in the pre-market Monday after the Cambridge, Massachusetts-based biotech announced that the Japanese drugmaker Otsuka Pharmaceutical plans to end its partnership for the development of kidney disease therapy, vadadustat.

Otsuka has decided to terminate the collaboration and license agreement for vadadustat in the U.S. as well as certain international markets effective May 23, 2023, a regulatory filing submitted by Akebia (AKBA) read.

However, the U.S. agreement would terminate as early as June 12, 2022, if the contractual infringements cited by Otsuka are not addressed. However, Akebia (AKBA) disputes the allegations.

“…the Company disagrees with, and intends to dispute, Otsuka’s allegations of material breach and does not believe that Otsuka has a right to terminate the Otsuka U.S. Agreement for material breach,” it said.

“….the termination of the Otsuka U.S. Agreement should not be effective prior to the U.S. Termination Effective Date,” the company added.

Per the terms of the collaboration, Otsuka funds 80% of the global development costs for vadadustat.

In March, Akebia (AKBA) shares plunged after the company announced that the FDA declined to approve vadadustat.

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