Novavax discloses confidential settlement agreement with Fujifilm

In a regulatory filing, Novavax (NVAX) disclosed that on March 21, the company, FUJIFILM Diosynth Biotechnologies UK Limited, FUJIFILM Diosynth Biotechnologies Texas, and FUJIFILM Diosynth Biotechnologies USA entered into a Confidential Settlement Agreement and Release to resolve disputes regarding amounts that Fujifilm claimed were due under a prior Confidential Settlement Agreement and Release effective September 30, 2022 by and between the company and Fujifilm. Under the Prior SAR, the company agreed to pay up to $185M to Fujifilm in connection with cancellation of manufacturing activity at FDBT. The final two quarterly installments due to Fujifilm in 2023 under the Prior SAR, totaling $68.6M, were subject to Fujifilm’s obligation to use commercially reasonable efforts to mitigate losses associated with the vacant manufacturing capacity caused by the termination of manufacturing activities at FDBT. On October 2, 2023, the company sent Fujifilm a notice of breach and refused to pay the final two installments based on its contention that Fujifilm had not used commercially reasonable efforts to mitigate losses and should have offset some portion of the final two payments. On October 30, 2023, Fujifilm filed a demand for arbitration with Judicial Arbitration and Mediation Services seeking payment of the full amount. Pursuant to the Settlement Agreement, on March 25, the company paid $42M to Fujifilm, the parties agreed to a mutual release of claims arising from, under or otherwise in connection with the Prior SAR, and Fujifilm has agreed to dismiss the arbitration, the filing noted.