Osiris Therapeutics leveled trade theft and breach-of-contract charges worth nearly $7 million against a regenerative medicine rival, stemming from the Stability Biologics acquisition by MiMedx (NSDQ:MDXG).
Columbia, Md.-based Osiris said it inked a distribution deal back in 2013 to have Stability sell a pair of its products through the end of 2015. But after MiMedx paid $10 million for Stability in January 2016, it allegedly gained access to Osiris trade secrets and fostered a series of events leading to $6.8 million in losses for Osiris.
(In an about-face in August 2017, MiMedx agreed to sell Stability back to its original owners; that sale closed last October.)
The lawsuit, filed this week in the U.S. District Court for Maryland, alleged that MiMedx held on to Osiris inventory worth $2.2 million and $1.3 million in pre-paid commissions and directed Stability not to pay another $2.9 million allegedly owed under a payment plan; Osiris allegedly incurred another $321,000 in legal fees from its attempt to recoup its losses in arbitration.
“Osiris sustained at least $6,751,416.21 in compensatory damages and costs,” the lawsuit alleged. “Osiris also incurred additional unascertainable damages, reputational damage and competitive disadvantages from MiMedx’s misappropriation of Osiris’s confidential information.”