Contract analysis

1. Plaintiff Penterra Pharmaceuticals Corp. is a corporation organized and existing under the laws of the State of Delaware. Penterra is publicly traded on the Nasdaq Stock Market under the ticker symbol "PTRA." Penterra's principal place of business is located at 400 Carnegie Center Drive, Suite 600, Princeton, New Jersey 08540. Penterra is a specialty pharmaceutical company focused on the development, manufacture,

2. Defendant Vantage Medical Distribution, LLC is a limited liability company organized and existing under the laws of the Commonwealth of Massachusetts. Vantage's principal office is located at 75 Cabot Road, Suite 310, Medford, Massachusetts 02155. Vantage is a regional specialty pharmaceutical distributor that focuses on hospital-based and clinic-based oncology and immunology products throughout the northeastern U

3. This Court has subject-matter jurisdiction over this action pursuant to Massachusetts General Laws chapter 231A, sections 1 through 2, which authorize the Superior Court to make binding declarations of right, duty, status, and other legal relations arising under deeds, wills, contracts, and other written instruments. The declaratory relief sought herein arises directly from the parties' written Exclusive Distribut

4. This Court has personal jurisdiction over Vantage because Vantage is a limited liability company organized under the laws of the Commonwealth of Massachusetts, maintains its principal office in Medford, Massachusetts, conducts continuous and systematic business operations within the Commonwealth, and has consented to the jurisdiction of the Massachusetts courts. Section 14.5 of the Agreement expressly provides: "A

5. Venue is proper in the Business Litigation Session of the Superior Court, Suffolk County, because the parties' Agreement designates the courts of the Commonwealth of Massachusetts for the resolution of any disputes arising under or in connection with the Agreement. Moreover, this action involves a complex commercial dispute concerning the interpretation of a multi-year exclusive distribution agreement with signifi

6. Penterra is a mid-cap specialty pharmaceutical company that develops, manufactures, and commercializes pharmaceutical products in the therapeutic areas of oncology, rare diseases, and immunology. Penterra markets and sells its products in the United States through a network of regional exclusive distributors and two national specialty pharmacy partners. Penterra's flagship oncology product is Oncalaris® (pegvisoma

7. Vantage is a regional specialty pharmaceutical distributor founded in 2009 by Donald R. Farnham. Over the past twelve years, Vantage has built its business by focusing on hospital-based and clinic-based oncology and immunology products across the northeastern United States. Vantage has grown significantly through several regional exclusive distribution agreements with mid-tier pharmaceutical manufacturers, and it

8. In 2016 and early 2017, Penterra and Vantage entered into negotiations concerning the terms of an exclusive distribution arrangement under which Vantage would serve as the exclusive distributor for certain Penterra products in the New England region. During these negotiations, the parties discussed the geographic scope of the proposed exclusive territory at length. The parties ultimately agreed that Vantage's excl

9. On July 1, 2017, Penterra (designated as the "Supplier") and Vantage (designated as the "Distributor") entered into the Exclusive Distribution Agreement. A true and correct copy of the Agreement, including all Exhibits thereto, is attached hereto as Exhibit 1 and incorporated herein by reference. The Agreement had an initial term of five (5) years, commencing on July 1, 2017 and expiring on June 30, 2022, with two

10. Section 2.1 of the Agreement sets forth the grant of exclusive distribution rights. That section provides, in pertinent part: "Supplier hereby grants to Distributor the exclusive right to distribute the Products within the Territory, as defined in Exhibit A." This grant of exclusivity is explicitly tied to, and delimited by, the Territory as defined in Exhibit A to the Agreement.

11. Exhibit A to the Agreement defines the "Territory" as follows: "The states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont (collectively, the 'New England States')." The Territory, as expressly and unambiguously defined in Exhibit A, is limited to six specifically enumerated states, all of which are New England states. Exhibit A contains no reference whatsoever to the states of New

12. Section 2.3 of the Agreement sets forth a limitation on distribution outside the Territory. That section provides, in pertinent part: "Distributor shall not actively solicit orders for, or deliver, the Products outside the Territory without Supplier's prior written consent." This provision expressly prohibits Vantage from actively soliciting orders for, or delivering, Penterra's Products outside the six New Engla

13. Section 13.1 of the Agreement governs amendments and modifications. That section provides, in pertinent part: "No amendment, modification, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument signed by both parties." Under this provision, the Territory defined in Exhibit A may not be modified, expanded, amended, or waived except by a written instrument that has

14. Section 14.8 of the Agreement contains an integration clause. That section provides, in pertinent part: "This Agreement, including all Exhibits, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, or agreements relating thereto, whether written or oral." This integration clause establishes the EDA, including all of

15. Section 14.2 of the Agreement contains a governing law provision. That section provides, in pertinent part: "This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, without regard to its conflicts of law principles." The parties agreed that the laws of the Commonwealth of Massachusetts would govern the construction and interpretation of all provisions of

16. Section 14.5 of the Agreement contains a forum selection clause. That section provides, in pertinent part: "Any dispute arising under or in connection with this Agreement shall be submitted to the exclusive jurisdiction of the state or federal courts located in the Commonwealth of Massachusetts." The parties agreed to submit any and all disputes arising under or in connection with the Agreement to the exclusive j

17. Under Section 5.2 of the Agreement, Vantage committed to purchase a minimum of $9.5 million of Oncalaris® (pegvisomant-axel) per year, calculated at wholesale acquisition cost ("WAC"), during each year of the Agreement's term. This minimum purchase commitment was a material term of the Agreement, reflecting Penterra's expectation that Vantage would generate a meaningful volume of Oncalaris® sales within the New E

18. On January 12, 2018, Steven Kapoor, who at that time served as Penterra's Vice President of Commercial Operations, sent an email to Donald R. Farnham, Vantage's Managing Member and Chief Executive Officer. A true and correct copy of the email is attached hereto as Exhibit 2 and incorporated herein by reference. The email stated, in its entirety: "Don — good catching up yesterday. We're definitely open to explorin

19. No written amendment to Exhibit A to the Agreement was ever executed by both Penterra and Vantage following the January 12, 2018 Kapoor Email. At no time following the Kapoor Email did the parties execute a written instrument signed by both parties expanding, modifying, or amending the Territory to include New York, New Jersey, or Pennsylvania. No such written instrument has ever existed. The Kapoor Email was a o

20. On or about September 14, 2020, Vantage commenced distributing Oncalaris® (pegvisomant-axel) to hospitals and oncology clinics located in New York, New Jersey, and Pennsylvania. These shipments were directed to healthcare facilities outside the six New England states defined as the Territory in Exhibit A to the Agreement. Penterra did not provide prior written consent, or any other form of consent, under Section

21. Between approximately September 14, 2020 and March 2021, Vantage generated approximately $6.4 million in revenues from unauthorized sales of Oncalaris® in the tri-state area of New York, New Jersey, and Pennsylvania. These sales were not incidental or passive; rather, they were the product of active solicitation by Vantage personnel. Specifically, these sales were conducted by Vantage's Outside Sales Director, Br

22. On February 15, 2021, Penterra executed a non-binding term sheet with Meridian National Distributors, Inc. ("Meridian"), a corporation organized under the laws of the State of New York with its principal office at 520 Seventh Avenue, 12th Floor, New York, New York 10018. Meridian is a large-scale specialty pharmaceutical distributor, and its president is Thomas Welliver. The term sheet contemplated that Meridian

23. On March 8, 2021, Jennifer Chao, Esq., Penterra's Senior Vice President and General Counsel, sent a letter via certified mail to Donald R. Farnham at Vantage's principal office in Medford, Massachusetts. A true and correct copy of that letter is attached hereto as Exhibit 3 and incorporated herein by reference. In the letter, Ms. Chao demanded that Vantage immediately cease and desist from distributing Oncalaris®

24. On March 22, 2021, Kenneth M. Rourke, Esq., a partner at Hargrove, Sinclair & Polk LLP, serving as outside counsel for Vantage, responded to Ms. Chao's cease-and-desist letter. A true and correct copy of Mr. Rourke's response is attached hereto as Exhibit 4 and incorporated herein by reference. In the response letter, Vantage, through Mr. Rourke, asserted that Vantage had the right to distribute Oncalaris® in the

25. An actual, present, and justiciable controversy exists between Penterra and Vantage regarding the scope of the exclusive Territory under the Agreement. The nature and contours of this controversy are well-defined. Penterra maintains that the Territory is limited to the six New England states expressly and unambiguously enumerated in Exhibit A to the Agreement — Connecticut, Maine, Massachusetts, New Hampshire, Rh

26. Plaintiff Penterra Pharmaceuticals Corp. repeats and re-alleges each and every allegation contained in Paragraphs 1 through 25 of this Complaint as though fully set forth herein.

27. Pursuant to Massachusetts General Laws chapter 231A, sections 1 and 2, Penterra is entitled to, and respectfully requests, a declaration by this Court that: (a) The "Territory" under the Exclusive Distribution Agreement dated July 1, 2017, as defined in Exhibit A thereto, is limited to the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont, and to no other states; (b) The Territ

28. The declaratory relief sought herein is warranted because the plain and unambiguous language of Exhibit A defines the Territory as six specifically enumerated states — Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont. Neither the Agreement itself, nor any duly executed written amendment thereto, extends the Territory beyond those six states. Under well-established Massachusetts law, whe

29. Furthermore, the declaratory relief sought herein is supported by the written-modification clause set forth in Section 13.1 of the Agreement, which expressly provides that no amendment, modification, or waiver of any provision of the Agreement shall be effective unless set forth in a written instrument signed by both parties. No written instrument signed by both Penterra and Vantage expanding the Territory to inc

30. Additionally, the integration clause set forth in Section 14.8 of the Agreement provides that the Agreement, including all Exhibits, constitutes the entire agreement between the parties with respect to its subject matter and supersedes all prior negotiations, representations, or agreements, whether written or oral. This integration clause bars Vantage from relying on the January 12, 2018 Kapoor Email, any alleged

1. Enter a declaratory judgment, pursuant to G.L. c. 231A, §§ 1–2, declaring that the "Territory" under the Exclusive Distribution Agreement dated July 1, 2017, as defined in Exhibit A thereto, is limited to the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont, and does not include the states of New York, New Jersey, or Pennsylvania;

2. Enter a declaratory judgment declaring that the January 12, 2018 email from Steven Kapoor to Donald R. Farnham does not constitute "prior written consent" within the meaning of Section 2.3 of the Agreement and does not constitute an amendment to Exhibit A under Section 13.1 of the Agreement;

3. Enter a declaratory judgment declaring that Vantage's distribution of Penterra's Products, including Oncalaris® (pegvisomant-axel), in the states of New York, New Jersey, and Pennsylvania is unauthorized and constitutes a violation of Section 2.3 of the Agreement;

4. Enter a declaratory judgment declaring that Penterra is free to appoint one or more distributors in New York, New Jersey, Pennsylvania, and any other states outside the Territory as defined in Exhibit A, without incurring any liability to Vantage;

5. Award Penterra its costs of suit in this action, including reasonable attorneys' fees to the extent permitted by applicable law; and

6. Grant such other and further relief as this Court deems just and proper. JURY DEMAND Plaintiff Penterra Pharmaceuticals Corp. hereby demands a trial by jury on all issues so triable in this action. Respectfully submitted, PENTERRA PHARMACEUTICALS CORP., By its attorneys, CALDERWOOD & HARKNESS LLP By: ________ Linda Osei (BBO No. 672841) Priya Anand (BBO No. 698215) Hannah Brinkley (BBO No. 704539) Patrick Gallaghe