MIGDAL HA'EMEQ, Israel, April 1, 2014 (GLOBE NEWSWIRE) -- Enzymotec Ltd. (Nasdaq:ENZY) ("Enzymotec" or the "Company"), a developer, manufacturer and marketer of innovative bio-active lipid ingredients, announced today that following a mediation process with Neptune Technologies & Bioressources, Inc. (Nasdaq:NEPT) ("Neptune"), in conjunction with litigation in the U.S. International Trade Commission ("ITC"), and based on latest developments regarding Neptune's patents in the U.S. Patent and Trademark Office ("USPTO"), it has decided that it will not continue its efforts to negotiate a final settlement agreement with Neptune.
"Our belief that Neptune's patents can be invalidated was recently reinforced by the USPTO institution, on March 24, 2014, of an inter partes review of Neptune's U.S. Patent No. 8,278,351. The USPTO concluded that there is reasonable likelihood that the petitioner will prevail in demonstrating unpatentability of the claims at issue. In addition, since no progress has been achieved during mediation, we have decided that it is not in our best interest to continue our efforts to try to negotiate a final settlement agreement with Neptune," said Dr. Ariel Katz, President and Chief Executive Officer of Enzymotec. "We believe we have meritorious defenses to all Neptune's patent claims, and we intend to continue to vigorously contest the complaints and to further challenge Neptune's patents."
As previously disclosed by Enzymotec, it is a party to a number of actions initiated by Neptune in the United States District Court for the District of Delaware, in which Neptune has claimed that Enzymotec's krill oil products infringe certain of its patents, namely U.S. Patent Nos. 8,030,348, 8,278,351 and 8,383,675, (the "'348 patent," the "'351 patent" and the "'675 patent," respectively).
Additionally, in April 2013, Enzymotec received notice of an investigation by the ITC following complaints filed by Neptune and its subsidiary, Acasti Pharma Inc., alleging a violation of section 337 of the Tariff Act of 1930 by reason of alleged infringement of the '351 patent and the '675 patent. In December 2013, the parties entered into a non-binding settlement term sheet and the ITC case was stayed. On February 11, 2014, the parties informed the ITC Administrative Law Judge that they would request mediation and would be filing a motion for a further stay of ITC proceedings. The motion was granted and the stay was extended until April 14, 2014.
The current status of Neptune's patents at the USPTO is as follows:
'348 Patent: In May 2013, the USPTO issued a Non-Final Action Closing Prosecution rejecting all of the claims in the '348 patent.
'351 Patent: In January 2014, the USPTO issued a Non-Final Office Action rejecting all the claims of the '351 patent in an ex parte reexamination. In addition, in March 2014, the USPTO issued a decision instituting an inter partes review of the '351 Patent filed by Aker BioMarine AS, concluding that there is reasonable likelihood that Aker will prevail in demonstrating unpatentability of the '351 patent claims at issue.
'675 Patent: In February 2014 Enzymotec filed a petition with the USPTO for inter partes review of the '675 Patent. That petition has not yet been decided by the USPTO.
About Enzymotec Ltd.
Enzymotec is a leading global supplier of specialty lipid-based products and solutions. The Company develops, manufactures and markets innovative bio-active lipid ingredients, as well as final products, based on sophisticated processes and technologies. For more information, visit www.enzymotec.com.
This release may contain forward-looking statements, which express the current beliefs and expectations of Company management, including with respect to the outcome of litigation and the Company's ability to estimate the likelihood of financial loss. Such statements involve a number of known and unknown risks and uncertainties that could cause our future results, performance, achievements or the outcome of litigation to differ significantly from the results, performance, achievements or outcomes expressed or implied by such forward-looking statements. Important factors that could cause or contribute to such differences include the following risks: if any claim of the patents is found to be infringed, valid and enforceable by the District Court, the District Court could award damages against us, including monetary damages in the form of lost profits or a reasonable royalty, as determined by the District Court (with the possibility of interest and fees). Treble damages may also be awarded if the applicable requirements are found; calculating the measure of lost profits or a reasonable royalty is complex and would depend in part on aspects of Neptune's business that are not known to us; we have agreed to indemnify and be financially responsible for any damages awarded against certain of our customers resulting from the purchase, importation, sale, use or offer to sell of our products in the event such products are found to infringe certain of Neptune's patent rights; an injunction by the District Court or an exclusion order by the ITC could also be issued against us, either of which could prevent us from selling the allegedly infringing products in the United States, a significant market for our krill oil products; the District Court or ITC could also order other actions that could impose additional costs and expenses upon us; we could suffer significant reputational harm from any adverse ruling in these actions, which could significantly affect our market value, and such harms and negative effects could also occur from the mere expectation that an adverse ruling could be issued; and other factors discussed under the heading "Risk Factors" in the Company's final prospectus for its public offering filed with the Securities and Exchange Commission on March 3, 2014. Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made only as of the date hereof, and the company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
CONTACT: ICR, LLC Katie Turner 646-277-1228 -or- John Mills 310-954-1105 John.Mills@icrinc.comSource:Enzymotec Ltd.