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Orexigen $3.67 million McKesson receivable settlement OK’d by court
By Caroline Salls
Pittsburgh, May 18 – Orexigen Therapeutics, Inc. received court approval of a $3.67 million distributor account receivable settlement reached with McKesson Corp. and McKesson Patient Relationship Solutions (MPRS), according to an order filed Friday with the U.S. Bankruptcy Court for the District of Delaware.
Orexigen said it and McKesson are parties to a core distribution agreement under which McKesson operates as an authorized distributor of health care products to Orexigen and performs related core services.
In addition, Orexigen and MPRS are parties to a master services agreement related to the processing of Orexigen’s LoyaltyScript, which provides patient discounts through retail pharmacies.
Orexigen said McKesson made $3.27 million of a total of $6.93 million in payments owed under the distribution agreement but contends that the entire receivable amount is subject to contractual setoff, recoupment and withholding rights.
As a result, McKesson placed an administrative hold on $3.67 million of pre-bankruptcy amounts owed to Orexigen.
According to the motion, MPRS says it holds an $8.5 million claim against Orexigen, and the McKesson entities claim that they have a contractual right to set the MPRS claim off against the McKesson distribution receivable.
Under the settlement, McKesson will make a $3.67 million payment to Orexigen, which will be applied to the distribution agreement receivable.
If McKesson’s MPRS setoff motion is granted, the difference between the settlement amount and the setoff amount will be paid to MPRS by Orexigen.
Orexigen is a San Diego-based biopharmaceutical company focused on the treatment of obesity. The company filed for bankruptcy on March 12 under Chapter 11 case number 18-10518.
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