New York Court Awards RedHill Biopharma $8 Million in Contract Dispute, Bolstering Drug Development Efforts

The Supreme Court of New York has ruled in favor of RedHill Biopharma Ltd. in a breach of contract lawsuit against South Korea's Kukbo Co. Ltd., awarding the specialty biopharmaceutical company approximately $8 million plus costs. This judgment, comprising $6.5 million in damages and roughly $1.5 million in interest, represents a significant legal and financial victory for RedHill. The lawsuit originated from Kukbo's failure to make agreed-upon payments under a subscription agreement signed in October 2021 and a subsequent exclusive license agreement from March 2022, which were related to the development of RedHill's drug opaganib for COVID-19 treatment.

The court's decision not only awards RedHill the substantial sum but also dismisses Kukbo's counterclaims. While Kukbo retains the right to seek an appeal, the ruling stands as a clear affirmation of RedHill's position. Dror Ben-Asher, RedHill's CEO, expressed gratitude for the court's "crystal-clear judgment," which he says affirms the company's stance from the outset of the relationship. This legal victory carries important implications for RedHill Biopharma. The awarded funds, once collected, will provide the company with additional capital to further develop its pipeline. Moreover, the resolution of this litigation removes a potential source of uncertainty for investors, potentially boosting confidence in the company's future prospects.

The timing of this legal win coincides with RedHill's progress in developing opaganib for other infectious diseases, notably Ebola. Recently, the company announced that the U.S. government's Biomedical Advanced Research and Development Authority (BARDA) had selected opaganib for development to treat Ebola virus disease. Under a cost-sharing agreement detailed at https://www.barda.gov, BARDA will provide partial funding to advance opaganib's development in mitigating and containing EBOV outbreaks. In an in vivo EBOV study conducted with the United States Army Medical Research Institute of Infectious Diseases, opaganib demonstrated a statistically significant increase in patient survival time when administered at 150 mg/kg twice daily. RedHill Biopharma reports that opaganib is the first host-directed molecule to show activity against EBOV, marking a potential breakthrough in treating this deadly disease.

Opaganib is a promising compound with anticancer, anti-inflammatory, and antiviral properties, currently being investigated for multiple indications. The drug is part of several U.S. government and academic collaborations, including development for radiation and chemical exposure indications such as Acute Radiation Syndrome, a phase 2/3 program for hospitalized COVID-19 patients, and a phase 2 program in oncology. The positive court ruling, combined with the progress in opaganib's development for various indications, positions RedHill Biopharma as a company to watch in the biopharmaceutical sector. The resolution of the legal dispute with Kukbo allows the company to focus more fully on its drug development efforts and potentially attract increased investor interest.

As RedHill Biopharma moves forward with its research and development programs, particularly in areas of high unmet medical need such as Ebola and other infectious diseases, the financial boost from this legal victory could play a crucial role in accelerating its progress. The company's ability to secure collaborations with U.S. government agencies further underscores the potential significance of its drug candidates in addressing critical health challenges. This development matters because it provides RedHill with both immediate financial resources and enhanced credibility, enabling continued advancement of treatments for serious diseases while demonstrating the importance of contractual integrity in international biopharma partnerships.