UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Purs uant to Section 13 or 15(d) of t he Securities Exchange Act of 1934

Date of Report ( Date of earliest event reported)  

June 30 , 2016

 

 

Amphastar Pharmaceuticals, Inc.

(Exact name of Registrant as specified in its charter)

 

 

 

 

 

 

 

 

Delaware

 

001-36509

 

33-0702205

(State or other jurisdiction of

incorporation)

 

(Commission

File Number)

 

(IR S Employer

Identification N o. )

 

11570 6th Street
Rancho Cucamonga, California 91730

(Address of principal executive offices, including zip code)

 

(909) 980-9484

(Registrant’s telephone number, including area code)

 

Not Applicable
(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


 

ITEM   1.01 .   Entry into a Material Definitive Agreement .

 

On June 30 , 2016 ,   Amphastar Pharmaceuticals , Inc. (the “Company”) and Actavis Laboratories FL, Inc.,   formerly known as Watson Laboratories, Inc. – Florida and Andrx Pharmaceuticals, Inc. (“ Actavis” ) ,   entered into a Seventh   Amendment and Termination Agreement (the “Amendment”) with respect to the Distribution Agreement by and between the Company and Actavis dated May 2, 2005, as amended by the First Amendment dated August 15, 2008, the Second Amendment dated February 19, 2013, the Third Amendment dated April 1, 2014, the Fourth Amendment dated January 7, 2015, the Fifth Amendment dated February 4, 2015, and the Sixth Amendment dated March 6, 2015 (as amended, the “Agreement”).  The Agreement relates to, among other things, Actavis   certain exclusive marketing rights for   the Company’s enoxaparin p roduct , which generally extend to the U.S. retail pharmacy market The Agreement was   filed as   Exhibit 10.7 to the Company’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 15, 2016 (incorporated by reference to Exhibit 10.7 to the Company’s Registration Statement on Form S-1 filed with the SEC o n May 20 , 2014) .

 

The Amendment deletes Section 2.2.3 of the Agreement , which concerns certain non-competition provisions, e ffective as of the Amendment date .  In addition, the Amendment terminates the Agreement up on the earlier of (i) January 1, 2017 and (ii) such earlier date that is thirty days (30) after Actavis notifies the Company in writing that Actavis has less than thirty (30) days inventory of the Product (as defined in the Agreement) remaining in Actavis possession or scheduled to be delivered pursuant to the pending purchase o rders (collectively, the “Termination Date ”).  Actavis must use Commercially Reasonable Efforts (as defined in the Agree ment) to sell its remaining inventory of the Product.   The Amendment also provides that the Company shall have the right to appoint a new distributor for the Company’s enoxaparin product as of the date of execution , provided that neither the Company nor such new distributor shall distribute, sell or otherwise commercialize the Product in the retail market subject to the Agreement prior to the Term ination Date of the Agreement. In the event that the Company or any distributor distributes, sells or otherwise commercializes the Product to Purchaser Customers (as defined in the Agreement) in the markets subject to the Agreement prior to the Termination Date, Actavis may terminate the Agreement upon written notice to the Company and, in addition to any other remedy available in law or in equity, upon such termination, the Company agrees to promptly repurchase all of Actavis’ remaining inventory of the Product at a price equal to the amount paid by Actavis for such inventory.   The Amendment also contains certain provisions related to the extension of the Termination Date ,   allocation of product labelling expenses, and the release of future claims. 

 

The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, which is filed as Exhibit 10 .1 to this Current Report on Form 8-K and incorporated herein by reference.

 

 

ITEM   1.02 .   Termination of a Material Definitive Agreement.

 

The information contained in Item 1.01 above is incorporated by reference into this Item 1.02.

 

 

ITEM   7.01 .   Regulation FD Disclosure.

 

The information contained in Item 1.01 above is incorporated by reference into this Item 7.01 .

 

Upon termination of the Agreement, the Company will   continue to sell its enoxaparin product   to the U.S. retail market for, which may include entry into agreements with new distributors or independent sales representatives and/or the initiation of direct sales efforts with new or existing customers .     No assurance can be given that the Company’s efforts to sell its enoxaparin product to the retail market ,  will be successful. 

 

The information set forth in this Item 7.01   is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act” ), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.


 

ITEM 9.01 . Financial Statements and Exhibits.

 

(d) Exhibits

 

 

 

 

 

 

Exhibit   No.

  

Description

 

 

   10 .1

  

Seventh Amendment and Termination Agreement by and between the Company and Actavis Laboratories FL, Inc. (f/k/a Watson Laboratories, Inc. – Florida and as Andrx Pharmaceuticals, Inc.) dated June 30 , 2016.  

 


 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

 

 

AMPHASTAR PHARMACEUTICALS, INC.

Date: J uly 7 , 2016

 

 

By: /S/WILLIAM J. PETERS

 

 

William J. Peters

 

Chief Financial Officer and Senior Vice President

 

 

 

 

 

 

 


Exhibit 10.1

 

THIS SEVENTH AMENDMENT AND TERMINATION AGREEMENT (the “ Seventh Amendment”) is entered into o n this 30 th   day of June ,   20 1 6 (the “ Amendment Date ”) by and between Amphastar Pharmaceuticals, Inc., a Delaware Corporation, (“ Amphastar ”) and Actavis Laboratories FL, Inc. (f/k/a Watson Laboratories, Inc. – Florida and as Andrx Pharmaceuticals, Inc.)  ( Actavis or “ Purchase r” ).

 

WHEREAS, Amphastar and Actavis   (collectively as “ Parties ”) have previously entered into that certain Distribution Agreement dated May 2, 2005 ,   which w as amended by the First Amendment dated August 15, 2008 ,   the Second Amendment dated February 19, 2013 ,   the Third Amendment dated April 1, 2014 , the Fourth Amendment dated January 7, 2015 , the Fifth Amendment dated February 4, 2015 , and the Sixth Amendment dated March 6, 2015  ( as amended, the “ Agreement ”) ,   related to, among other things, Actavis ’s distribution of Product (as defined in the Agreement); and

 

WHEREAS, the parties wish to further amend   the Agreement as set forth below .

 

NOW THEREFORE, in consideration of the mutual covenants and promises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the P arties hereby agree ,   as follows:

 

1.

Amendment of Section 2 . 2.3   of the Agreement .    

 

Effective immediately as of the Amendment Date ,   Section 2. 2.3 of the Agreement   shall be deemed automatically deleted in its entirety and shall have no further force and effect .  

 

2 . Termination of Agreement .  

 

a) The Parties hereby mutually agree that th e Agreement shall automatically terminate, with no further action by the Parties , on the earlier of (i) January 1, 2017 and (ii) such date that is thirty days (30) after Actavis notifies Amphastar in writing that Actavis has less than thirty (30) day s   inventory of the Product remaining   in Actavis possession or scheduled to be delivered pursuant to the pending Purchase Orders (the “ 30 Day Notice ”) ,   provided that Actavis must use Commercially Reasonable Efforts to sell its remaining inventory of the Product and shall provide Amphastar with the 30 Day Notice no later than three (3) business days following the actual date that Actavis has less than thirty (30) days inventory of the Product remaining in Actavis possession or on order . Notwithstanding the foregoing , if Amphastar fails to deliver Purchaser’s pending Purchase Orders for Product within thirty (30) days of the presently scheduled delivery date, Purchaser shall have the right to extend the foregoing January 1, 2017 date by the total amount of days that Amphastar failed to deliver the Product after the presently scheduled delivery date (the “ Termination Date ”) .  

 

b) Notwithstanding the Preamble, Section 2.1.1 of the Agreement or anything else to the contrary ,   on and after the Amendment Date, Amphastar shall have the right to  


 

appoint a new distributor for the Product to Purchaser Customers in the Territory defined by the Agreement ,   but only on the condition that neither Amphastar nor such new distributor (or their respective Affiliates or designees )   shall distribut e , sell or otherwise commercialize   the Product to Purchaser C ustomers in the Territory prior to the Termination Date .   I n the event that Amphastar or any distributor (or their respective Affiliates or designees) distribute s , sell s or otherwise commercialize s the Product to Purchaser Customers in the Territory prior to the Termination Date ,   Purchaser may terminate the Agreement upon written notice to Amphastar and in addition to any other remedy available in law or in equity, upon such termination, Amphastar agrees to   promptly re purchase all of Purchaser’s r emaining inventory of the Product at a price equal to the amount paid by Purchaser for such inventory.       

 

c) Following the delivery of the 30 Day Notice or December 1, 2016, whichever is earlier , Actavis shall use Commercially Reasonable Efforts to provide Amphastar and/ or its new distributor with any customer or Product pricing information that Amphastar may reasonably request with respect to the Product sold by Actavis to its customers prior to the Termination Date including but not limited to customer lists, quantities sold, agreement price, Dead Net Pricing (defined as the price after all discount, allowances, rebates, chargebacks, customer fees, and any other deductions from sales), and related information for each Purchaser Customers .  

 

3 . Release Amphastar does hereby release, acquit, satisfy, and forever discharge Actavis and its Affiliates   (including Allergan plc   and any of its subsidiaries )   from any and all c laims, in law or in equity, which it now has, or hereafter may have against the other party in connection with the Agreement ,   other than (i) the payment obligations owing to Amphastar under Article 4 of the Agreement as of the Termination Date ; and (ii) any claims for damages resulting from a party’s gross negligence or intentional misconduct .  For the avoidance of doubt, Actavis does not release Amphastar from its Product warranty obligations or from its indemnification obligations pursuant to Section 17.4 , pursuant to which Amphastar indemnif ies   Actavis for any d amages that result from the Momenta litigation and/or any other Third Party Infringement Claim .

 

4 . Product Labeling . Actavis will reimburse Amphastar for the actual out of pocket cost of (i) any of the Product Labeling inventories remaining as of the Termination Date (“ Product Labeling Inventories ”), and (ii) the disposal cost for such Product Labeling Inventories.

 

5. Public Announcements . Neither Amphastar nor any of its Affiliates or   designees shall issue any press release or make any public announcement relating   to the subject matter of the Agreement without the prior written consent of   Actavis, which consent shall not be unreasonably withheld, delayed or   conditioned; provided, however, that Amphastar may make any public disclosure it   believes in good faith is required by applicable Law (in which case Amphastar   will provide reasonable advance notice to Actavis prior to making the disclosure   and will in good faith consider the reasonable comments of Actavis on such   disclosure).

 

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6 . Definitions .  Unless otherwise defined herein, capitalized terms shall have the meanings as defined in the Agreement.

 

7 . Scope of Amendment Except as expressly and specifically amended hereby, all other provisions and, terms and conditions of the Agreement shall remain unchanged and in full force and effect.

 

8 . Counterparts .     This Seventh Amendment may be executed in several counterparts, each of which shall be deemed and original, but all of which together shall constitute one and the same instrument.  Signatures delivered via facsimile or other electronic means shall have the full force of an original signature .

 

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IN WITNESS WHEREOF, the parties have caused their duly authorized representatives to execute this Seventh   Amendment as of the date first written above.

 

 

 

 

 

AMPHASTAR PHARMACEUTICALS, INC.

 

 

 

By :

/S/ Jacob   Liawatidewi

 

Name:

Jacob Liawatidewi

 

Title:

Sr. VP Corporate Admin Center

 

 

 

 

ACTAVIS LABORATORIES FL, INC.

 

 

 

 

By:

/S/ Daniel N. Motto

 

Name

Daniel N. Motto

 

Title:

SVP, Global Business Development

 

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