Bayer Unit Says GenesisCare Bankruptcy Delayed Cancer Drug Tests

A Bayer AG subsidiary asked a bankruptcy court to force Genesis Care Pty Limited to cancel a $31 million contract to research and run tests for experimental an prostate cancer drug.

Bayer Consumer Care AG, a wholesale distributor of prescription drugs, argued Wednesday that the bankruptcy of the Australian cancer care service provider’s US arm has significantly delayed the clinical study of the Xofigo drug. GenesisCare must immediately reject the contract or allow Bayer Consumer Care to terminate the deal, Bayer Consumer Care said in a motion filed with the US Bankruptcy Court for the Southern District of Texas.

Under the contract, known as the Institution Sponsored Collaborative Study (ISCS) Agreement, GenesisCare received a non-exclusive license agreement to conduct a clinical trial on the drug and was expected to provide Bayer Consumer Care with the outcome data and intellectual property, according to Wednesday’s filing.

“Unfortunately, given its financial condition and announced liquidation through the above-captioned case, Debtors cannot fulfill the terms of the ISCS Agreement, and conduct the Clinical Study,” said Bayer Consumer Care. GenesisCare’s inability to meet obligations will “unnecessarily leave Bayer without the ability to move forward with continued research and development,” it added.

Bayer Consumer Care said GenesisCare has attempted to sell the contract as part of its bankruptcy auction process, but that the sale timeline is taking too long. The sale process will add at least four months before any potential buyer would be able to resume negotiations on the contract or continue preparations for the study, Bayer Consumer Care said.

Bids are due in September. A GenesisCare lawyer said in July that the company will likely sell its US operations in pieces.

GenesisCare filed for bankruptcy in June, announcing plans to sell its of struggling US operations. It secured commitments for $200 million of financing to help the company fund itself in bankruptcy.

GenesisCare didn’t immediately respond to a request for comment.

This case is Genesis Care Pty Limited, Bankr. S.D. Tex., No. 4:23-bk-90614, 8/2/23.