Opinion ID: 2743434
Heading Depth: 3
Heading Rank: 3

Heading: Interlukin 9 (“IL9”)

Text: IL9 was an antibody program for asthma. Genaera had licensed the technology to MedImmune, LLC (“MedImmune”). Under its agreement with MedImmune, Genaera could have received up to $54 million in payments and royalties if IL9 reached certain development milestones. The complaint alleges that defendant Skolas had previously told Schmidt that IL9 had the potential for “$3 to $4 billion peak year sales.” App. at 99a. On May 18, 2010, the liquidating trustee sold IL9 for “a mere” $2.75 million to defendant Ligand Pharmaceuticals (“Ligand”). Two days later, Ligand conveyed half of that interest to defendant BVF—one of Genaera’s largest shareholders. Ligand filed the IL9 purchase agreement with the SEC on May 24, 2010, as an attachment to a Form 8-K. The purchase agreement disclosed the price and the subsequent sale to BVF. 10 The complaint alleges that the sale to Ligand for a “de minimis” price was a fraudulent transaction intended to allow BVF to acquire the asset at a price below its value. The complaint points to the fact that prior to the liquidation, BVF was both Genaera’s second-largest shareholder and also owned 15% of Ligand’s stock. However, in the period before Genaera’s dissolution, BVF sold Ligand stock until it held less than a 10% share, and thus would no longer be considered a Ligand insider. BVF’s reduction in its ownership of Ligand, the complaint alleges, was a smokescreen to disguise the fact that the sale of IL9 to Ligand, which subsequently conveyed it to BVF, was actually a preferential sale to a major Genaera shareholder. Finally, the complaint alleges that the net effect of this transfer was to take a valuable asset that would have benefited all of Genaera’s shareholders and transfer it to a single major shareholder.