Fresenius Quits Akorn Buy, Alleges Fraud
German healthcare company Fresenius Kabi has terminated plans to merge with US generics company Akorn, claiming it has discovered data integrity breaches relating to Akorn’s product development.
Fresenius said it had offered to delay its decision to give the Illinois-based company time to complete its own investigation, but Akorn declined the offer. In response, Akorn filed a lawsuit in Delaware Chancery Court, asking that Fresenius be required to fulfil its obligations under the merger agreement.
“Fresenius’ attempt to terminate the transaction on the pretext that the findings from the ongoing investigation are a breach of the merger agreement is completely without merit. We intend to vigorously enforce our rights, and Fresenius’ obligations, under our binding merger agreement,” Akorn said.
The companies had decided to merge in April 2017, with Fresenius to pay around $4.3 billion for Akorn. Under the terms, Akorn had agreed to a $129 million termination fee if the transaction collapsed.
According to Bloomberg news agency, Akorn’s lawyers said in the unsealed lawsuit that Fresenius has wrongfully pulled out of the purchase because it had “buyer’s remorse” over the price.
In an unrelated event, Akorn’s chairman John Kapoor resigned last October after he was charged, as the founder of Insys Therapeutics, with bribing doctors and pharmacists to overprescribe an opioid pain medication. Several other Insys executives have also been indicted.
