1018-00007 · Penterra Pharmaceuticals Corp · Pleadings

statement-of-undisputed-material-facts.docx DOCUMENT Litigation

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COMMONWEALTH OF MASSACHUSETTS

SUPERIOR COURT BUSINESS LITIGATION SESSION SUFFOLK COUNTY

PLAINTIFF PENTERRA PHARMACEUTICALS CORP.'S STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT PURSUANT TO SUPERIOR COURT RULE 9A(b)(5)

Plaintiff Penterra Pharmaceuticals Corp. ("Penterra" or "Plaintiff"), by and through its undersigned counsel, Calderwood & Harkness LLP, hereby respectfully submits this Statement of Undisputed Material Facts pursuant to Superior Court Rule 9A(b)(5) in support of its Motion for Summary Judgment. Each fact set forth herein is supported by specific citations to the summary judgment record, including deposition transcripts, affidavits, and documentary exhibits filed contemporaneously herewith. Unless otherwise indicated, all exhibit references are to the exhibits accompanying Plaintiff's Appendix in Support of Its Motion for Summary Judgment, filed on the date hereof.

STATEMENT OF UNDISPUTED MATERIAL FACTS

I. The Parties

1. Penterra Pharmaceuticals Corp. ("Penterra") is a corporation duly organized and existing under the laws of the State of Delaware, with its principal place of business at 400 Carnegie Center Drive, Suite 600, Princeton, New Jersey 08540. Penterra is publicly traded on the Nasdaq Stock Market under the ticker symbol "PTRA." (Affidavit of Steven Kapoor ("Kapoor Aff.") ¶ 2; Complaint ¶ 1.)

2. Penterra is a specialty pharmaceutical company focused on the therapeutic areas of oncology, rare diseases, and immunology. In fiscal year 2021, Penterra reported consolidated revenues of approximately $1.87 billion. (Kapoor Aff. ¶ 3; Penterra Pharmaceuticals Corp. Annual Report on Form 10-K for Fiscal Year 2021 (excerpts), Exh. 1.)

3. Penterra's flagship oncology product is Oncalaris® (pegvisomant-axel), a next-generation pegylated enzyme therapy indicated for the treatment of refractory colorectal cancer, commercially available in 20 mg and 40 mg vials. Oncalaris® accounted for approximately $412 million in revenue in fiscal year 2021, representing approximately 22% of Penterra's consolidated revenues for that period. (Kapoor Aff. ¶ 4; Exh. 1.)

4. Defendant Vantage Medical Distribution, LLC ("Vantage") is a limited liability company organized under the laws of the Commonwealth of Massachusetts, with its principal office located at 75 Cabot Road, Suite 310, Medford, Massachusetts 02155. (Answer and Counterclaims ¶ 2; Exclusive Distribution Agreement dated July 1, 2017 ("EDA"), Preamble, Exh. 3.)

5. Vantage is a regional specialty pharmaceutical distributor founded in 2009 by Donald R. Farnham, who serves as its Managing Member and Chief Executive Officer. (Deposition of Donald R. Farnham ("Farnham Dep."), taken October 18, 2021, at 12:4–13:8.)

6. In fiscal year 2021, Vantage reported total revenues of approximately $148 million, of which approximately $67 million — representing approximately 45.3% of Vantage's total revenues — was attributable to the distribution of Penterra products. (Vantage Internal Financial Statements, produced in this litigation as Bates No. VMD-00412, Exh. 2.)

II. The Exclusive Distribution Agreement

7. On July 1, 2017, Penterra (identified therein as "Supplier") and Vantage (identified therein as "Distributor") entered into an Exclusive Distribution Agreement (the "Agreement" or "EDA"). The EDA was executed by Steven Kapoor on behalf of Penterra and by Donald R. Farnham on behalf of Vantage. (Exclusive Distribution Agreement dated July 1, 2017, Exh. 3; Farnham Dep. at 22:10–23:2; Kapoor Aff. ¶ 5.)

8. The EDA covers two Penterra pharmaceutical products: (a) Oncalaris® (pegvisomant-axel), in both 20 mg and 40 mg vials; and (b) Renuvesta® (cilosporin-beta), in 5 mg capsules. These products are defined in Section 1.1 and the Recitals of the EDA. (EDA § 1.1 and Recitals, Exh. 3.)

9. Section 2.1 of the EDA provides, in pertinent part: "Supplier hereby grants to Distributor the exclusive right to distribute the Products within the Territory, as defined in Exhibit A." (EDA § 2.1, Exh. 3.)

10. Exhibit A to the EDA defines the "Territory" as follows: "The states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont (collectively, the 'New England States')." (EDA, Exhibit A, Exh. 3.)

11. Section 2.3 of the EDA expressly restricts Vantage's distribution activities outside the defined Territory: "Distributor shall not actively solicit orders for, or deliver, the Products outside the Territory without Supplier's prior written consent." (EDA § 2.3, Exh. 3.)

12. Section 5.2 of the EDA required Vantage, as Distributor, to purchase a minimum of $9.5 million of Oncalaris® per year, calculated at wholesale acquisition cost ("WAC"), during each year of the Agreement's term. (EDA § 5.2, Exh. 3.)

13. Section 13.1 of the EDA contains an anti-oral-modification provision, providing in full: "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." (EDA § 13.1, Exh. 3.)

14. Section 14.8 of the EDA contains a standard integration clause, providing: "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." (EDA § 14.8, Exh. 3.)

15. Section 14.2 of the EDA provides that the 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. (EDA § 14.2, Exh. 3.)

16. The EDA has an initial term of five (5) years, commencing on July 1, 2017, and expiring on June 30, 2022, with two successive one-year automatic renewal options unless either party provided at least 180 days' written notice of non-renewal prior to the expiration of the then-current term. (EDA § 3.1, Exh. 3.)

III. Vantage's Performance Under the EDA

17. In fiscal year 2018, Vantage purchased $11.2 million of Oncalaris® from Penterra, exceeding the annual minimum purchase commitment of $9.5 million set forth in Section 5.2 of the EDA by $1.7 million. (Penterra Accounts Receivable Records — Vantage Oncalaris® Purchases (FY 2018–2021), Exh. 4; Farnham Dep. at 34:15–35:6.)

18. In fiscal year 2019, Vantage purchased $14.8 million of Oncalaris® from Penterra, exceeding the annual minimum purchase commitment of $9.5 million by $5.3 million. (Exh. 4; Farnham Dep. at 35:7–36:1.)

19. In fiscal year 2020, Vantage purchased $18.3 million of Oncalaris® from Penterra, exceeding the annual minimum purchase commitment of $9.5 million by $8.8 million. (Exh. 4; Farnham Dep. at 36:2–37:9.)

20. For the nine-month period ending March 2021 of fiscal year 2021, Vantage purchased $16.1 million of Oncalaris® from Penterra. When annualized, this figure equates to approximately $21.47 million in Oncalaris® purchases for the full fiscal year. (Exh. 4; Farnham Dep. at 37:10–38:4.)

IV. The January 12, 2018 Kapoor Email

21. On January 12, 2018, Steven Kapoor, Penterra's Vice President of Commercial Operations, sent an email to Donald R. Farnham at Vantage. The email stated in full, as relevant: "Don — good catching up yesterday. We're definitely open to exploring expansion into NY/NJ/PA once your New England footprint is fully ramped. Let's circle back mid-year and see where things stand." (January 12, 2018 Email from S. Kapoor to D. Farnham, Exh. 5; Kapoor Aff. ¶ 8.)

22. Steven Kapoor testified at his deposition, taken on November 2, 2021, that the January 12, 2018 email expressed a willingness on Penterra's part to explore a potential future expansion of the Territory into the states of New York, New Jersey, and Pennsylvania, but that the email did not constitute prior written consent under Section 2.3 of the EDA, nor did it constitute or purport to be an amendment to Exhibit A of the EDA. (Deposition of Steven Kapoor ("Kapoor Dep."), taken November 2, 2021, at 47:12–49:18; Kapoor Aff. ¶¶ 9–10.)

23. There is no written instrument signed by both Penterra and Vantage amending Exhibit A of the EDA to include New York, New Jersey, or Pennsylvania within the defined Territory. (Kapoor Aff. ¶ 11; Farnham Dep. at 56:8–57:3.)

24. At his deposition taken on October 18, 2021, Donald R. Farnham admitted that he did not obtain, nor did Vantage execute, a signed written amendment to Exhibit A of the EDA expanding the Territory to include New York, New Jersey, or Pennsylvania. (Farnham Dep. at 56:8–57:3; 58:14–59:2.)

25. Donald R. Farnham further acknowledged at his deposition that no officer, director, or authorized representative of Penterra expressly authorized Vantage to distribute Oncalaris® in the tri-state area (New York, New Jersey, and Pennsylvania) in a signed writing. (Farnham Dep. at 59:3–60:11.)

V. Vantage's Unauthorized Distribution in the Tri-State Area

26. On or about September 14, 2020, Vantage began shipping Oncalaris® to hospitals and oncology clinics located in the states of New York, New Jersey, and Pennsylvania (collectively, the "tri-state area"). (Vantage Shipping Records, produced as Bates Nos. VMD-01103 through VMD-01287, Exh. 6; Farnham Dep. at 62:5–63:14; Deposition of Brian Kopec ("Kopec Dep."), taken November 9, 2021, at 28:9–29:17.)

27. Brian Kopec, Vantage's Outside Sales Director, directed and oversaw Vantage's sales efforts targeting hospitals and oncology clinics in New York, New Jersey, and Pennsylvania beginning in or around September 2020. (Kopec Dep. at 30:4–32:12.)

28. Between September 2020 and March 2021, Vantage generated approximately $6.4 million in revenues from the distribution of Oncalaris® to customers in the tri-state area (New York, New Jersey, and Pennsylvania). (Vantage Tri-State Sales Records, produced as Bates Nos. VMD-01288 through VMD-01356, Exh. 7; Farnham Dep. at 71:8–72:15.)

29. Penterra's distribution logistics systems directed Oncalaris® shipments to Vantage only for delivery to customers located at New England addresses within the six-state Territory defined in Exhibit A of the EDA. Penterra never authorized, directed, or facilitated shipments of Oncalaris® to tri-state customers through Vantage. (Affidavit of Rachel Mendez ("Mendez Aff.") ¶¶ 4–7; Deposition of Rachel Mendez ("Mendez Dep."), taken November 16, 2021, at 18:3–20:9.)

30. Rachel Mendez, Penterra's Director of Distribution & Logistics, confirmed in both her affidavit and deposition testimony that Penterra's internal distribution framework did not authorize or contemplate Vantage distributing Oncalaris® to customers located outside the six New England states. Penterra's supply chain and logistics systems were configured to support distribution within the contractually defined Territory only. (Mendez Aff. ¶¶ 5–6; Mendez Dep. at 21:14–23:8.)

31. Vantage's shipments of Oncalaris® into the tri-state area were made without Penterra's prior written consent, as required by Section 2.3 of the EDA. No document evidencing such prior written consent has been produced or identified in this litigation. (Kapoor Aff. ¶ 12; Mendez Aff. ¶ 7; Farnham Dep. at 56:8–60:11.)

VI. Penterra's Cease-and-Desist Letter and Vantage's Response

32. On March 8, 2021, Jennifer Chao, Penterra's Senior Vice President and General Counsel, sent a written cease-and-desist letter to Donald R. Farnham at Vantage. The letter demanded that Vantage immediately cease distributing Oncalaris® outside the six New England states defined in Exhibit A of the EDA, and that Vantage confirm in writing its compliance with Section 2.3 of the Agreement. (March 8, 2021 Letter from J. Chao to D. Farnham, Exh. 8.)

33. On March 22, 2021, Kenneth M. Rourke of Hargrove, Sinclair & Polk LLP, writing on behalf of Vantage, responded to Penterra's cease-and-desist letter. In the response, counsel for Vantage asserted that Vantage had obtained the right to distribute Oncalaris® in the tri-state area and further threatened a $35 million breach-of-contract and tortious interference counterclaim against Penterra if Penterra appointed a competing distributor in those states. (March 22, 2021 Letter from K. Rourke to J. Chao, Exh. 9.)

34. Vantage's claim that the January 12, 2018 Kapoor Email constituted written consent to expand the Territory is the sole documentary basis asserted by Vantage for its purported right to distribute Oncalaris® in the states of New York, New Jersey, and Pennsylvania. Vantage has not identified any other writing that could constitute consent or authorization under Section 2.3 of the EDA. (Farnham Dep. at 64:18–66:4; Vantage's Answer and Counterclaims ¶¶ 18–22.)

35. In its Answer and Counterclaims and through deposition testimony of Donald R. Farnham, Vantage has also asserted that Penterra's alleged course of dealing over a period of approximately three years — including Penterra's purported failure to object to certain Vantage shipments of Oncalaris® to New York that Vantage contends began in late 2019 — effected a modification of Exhibit A of the EDA. (Vantage's Answer and Counterclaims ¶¶ 23–26; Farnham Dep. at 67:1–69:12.)

VII. Penterra's Term Sheet with Meridian National Distributors, Inc.

36. On February 15, 2021, Penterra executed a term sheet with Meridian National Distributors, Inc. ("Meridian"), a New York corporation with its principal office located at 520 Seventh Avenue, 12th Floor, New York, New York 10018, concerning the distribution of Oncalaris® in the states of New York, New Jersey, Pennsylvania, and Maryland. (Term Sheet dated February 15, 2021, between Penterra and Meridian National Distributors, Inc., Exh. 10; Kapoor Aff. ¶ 13.)

37. Thomas Welliver is the President of Meridian National Distributors, Inc. and executed the February 15, 2021 term sheet on behalf of Meridian. (Term Sheet, Exh. 10.)

38. The distribution arrangement contemplated by the Penterra-Meridian term sheet stalled and was not consummated after Vantage asserted, through counsel, that its exclusive distribution rights under the EDA encompassed the tri-state area and threatened litigation against Penterra and any competing distributor appointed by Penterra in those states. (Kapoor Aff. ¶ 14; Exh. 9.)

VIII. No Written Amendment or Modification Exists

39. No signed written amendment, modification, or supplement to the EDA or to Exhibit A thereto has been executed by both Penterra and Vantage at any time during the period from July 1, 2017 through the present date. The comprehensive document production in this matter, which has included the exchange of thousands of documents between the parties, has not revealed the existence of any such instrument. (Kapoor Aff. ¶ 15; Farnham Dep. at 56:8–57:3, 58:14–60:11; comprehensive document production in this matter.)

40. No document signed by both Penterra and Vantage exists that expands the Territory beyond the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont, as originally defined in Exhibit A of the EDA. (Kapoor Aff. ¶ 16; Farnham Dep. at 56:8–60:11.)

41. Section 14.5 of the EDA provides that any dispute arising under or in connection with the Agreement shall be submitted to the exclusive jurisdiction of the state or federal courts located in the Commonwealth of Massachusetts, and each party irrevocably consents to the personal jurisdiction of such courts. (EDA § 14.5, Exh. 3.)

Respectfully submitted,

PENTERRA PHARMACEUTICALS CORP., By its attorneys,

CALDERWOOD & HARKNESS LLP

By: ________

Linda Osei (BBO No. 672314) Priya Anand (BBO No. 698107) Hannah Brinkley (BBO No. 701482) Patrick Gallagher (BBO No. 704359)

CALDERWOOD & HARKNESS LLP 1 Federal Street, 35th Floor Boston, Massachusetts 02110 Telephone: (617) 555-7200 Facsimile: (617) 555-7201

Email: losei@calderwoodharkness.com

Dated: February 11, 2022

CERTIFICATE OF SERVICE

I, Linda Osei, hereby certify that on this 11th day of February, 2022, a true and correct copy of the foregoing Plaintiff Penterra Pharmaceuticals Corp.'s Statement of Undisputed Material Facts in Support of Its Motion for Summary Judgment Pursuant to Superior Court Rule 9A(b)(5), together with all exhibits referenced therein, was served upon counsel for Defendant Vantage Medical Distribution, LLC by electronic filing through the Court's electronic filing system and by depositing a copy in the United States mail, first-class postage prepaid, addressed as follows:

Kenneth M. Rourke, Esq. Alicia Fontaine, Esq. Hargrove, Sinclair & Polk LLP 200 Ashbury Asset Advisors, Suite 1800 Boston, Massachusetts 02109

________________________________________

Linda Osei

EXHIBIT LIST

The following exhibits are referenced in the foregoing Statement of Undisputed Material Facts and are filed contemporaneously herewith as part of Plaintiff's Appendix in Support of Its Motion for Summary Judgment:

PENTERRA PHARMACEUTICALS CORP.,

Plaintiff,

VANTAGE MEDICAL DISTRIBUTION, LLC,

Defendant.

Exhibit No.	Description
Exh. 1	Penterra Pharmaceuticals Corp. Annual Report on Form 10-K for Fiscal Year 2021 (excerpts)
Exh. 2	Vantage Medical Distribution, LLC Internal Financial Statements (Bates No. VMD-00412)
Exh. 3	Exclusive Distribution Agreement dated July 1, 2017, by and between Penterra Pharmaceuticals Corp. and Vantage Medical Distribution, LLC, including Exhibit A (Territory)
Exh. 4	Penterra Pharmaceuticals Corp. Accounts Receivable Records — Vantage Oncalaris® Purchases (FY 2018–2021)
Exh. 5	January 12, 2018 Email from Steven Kapoor (Penterra) to Donald R. Farnham (Vantage)
Exh. 6	Vantage Shipping Records (Bates Nos. VMD-01103 through VMD-01287)
Exh. 7	Vantage Tri-State Sales Records (Bates Nos. VMD-01288 through VMD-01356)
Exh. 8	March 8, 2021 Cease-and-Desist Letter from Jennifer Chao (Penterra) to Donald R. Farnham (Vantage)
Exh. 9	March 22, 2021 Letter from Kenneth M. Rourke (Hargrove, Sinclair & Polk LLP) to Jennifer Chao (Penterra)
Exh. 10	Term Sheet dated February 15, 2021, by and between Penterra Pharmaceuticals Corp. and Meridian National Distributors, Inc.

COMMONWEALTH OF MASSACHUSETTS
SUPERIOR COURT BUSINESS LITIGATION SESSION SUFFOLK COUNTY
PLAINTIFF PENTERRA PHARMACEUTICALS CORP.'S STATEMENT OF UNDISPUTED MATERIAL FACTS IN SUPPORT OF ITS MOTION FOR SUMMARY JUDGMENT PURSUANT TO SUPERIOR COURT RULE 9A(b)(5)
Plaintiff Penterra Pharmaceuticals Corp. ("Penterra" or "Plaintiff"), by and through its undersigned counsel, Calderwood & Harkness LLP, hereby respectfully submits this Statement of Undisputed Material Facts pursuant to Superior Court Rule 9A(b)(5) in support of its Motion for Summary Judgment. Each fact set forth herein is supported by specific citations to the summary judgment record, including deposition transcripts, affidavits, and documentary exhibits filed contemporaneously herewith. Unless otherwise indicated, all exhibit references are to the exhibits accompanying Plaintiff's Appendix in Support of Its Motion for Summary Judgment, filed on the date hereof.
STATEMENT OF UNDISPUTED MATERIAL FACTS
I. The Parties
1. Penterra Pharmaceuticals Corp. ("Penterra") is a corporation duly organized and existing under the laws of the State of Delaware, with its principal place of business at 400 Carnegie Center Drive, Suite 600, Princeton, New Jersey 08540. Penterra is publicly traded on the Nasdaq Stock Market under the ticker symbol "PTRA." (Affidavit of Steven Kapoor ("Kapoor Aff.") ¶ 2; Complaint ¶ 1.)
2. Penterra is a specialty pharmaceutical company focused on the therapeutic areas of oncology, rare diseases, and immunology. In fiscal year 2021, Penterra reported consolidated revenues of approximately $1.87 billion. (Kapoor Aff. ¶ 3; Penterra Pharmaceuticals Corp. Annual Report on Form 10-K for Fiscal Year 2021 (excerpts), Exh. 1.)
3. Penterra's flagship oncology product is Oncalaris® (pegvisomant-axel), a next-generation pegylated enzyme therapy indicated for the treatment of refractory colorectal cancer, commercially available in 20 mg and 40 mg vials. Oncalaris® accounted for approximately $412 million in revenue in fiscal year 2021, representing approximately 22% of Penterra's consolidated revenues for that period. (Kapoor Aff. ¶ 4; Exh. 1.)
4. Defendant Vantage Medical Distribution, LLC ("Vantage") is a limited liability company organized under the laws of the Commonwealth of Massachusetts, with its principal office located at 75 Cabot Road, Suite 310, Medford, Massachusetts 02155. (Answer and Counterclaims ¶ 2; Exclusive Distribution Agreement dated July 1, 2017 ("EDA"), Preamble, Exh. 3.)
5. Vantage is a regional specialty pharmaceutical distributor founded in 2009 by Donald R. Farnham, who serves as its Managing Member and Chief Executive Officer. (Deposition of Donald R. Farnham ("Farnham Dep."), taken October 18, 2021, at 12:4–13:8.)
6. In fiscal year 2021, Vantage reported total revenues of approximately $148 million, of which approximately $67 million — representing approximately 45.3% of Vantage's total revenues — was attributable to the distribution of Penterra products. (Vantage Internal Financial Statements, produced in this litigation as Bates No. VMD-00412, Exh. 2.)
II. The Exclusive Distribution Agreement
7. On July 1, 2017, Penterra (identified therein as "Supplier") and Vantage (identified therein as "Distributor") entered into an Exclusive Distribution Agreement (the "Agreement" or "EDA"). The EDA was executed by Steven Kapoor on behalf of Penterra and by Donald R. Farnham on behalf of Vantage. (Exclusive Distribution Agreement dated July 1, 2017, Exh. 3; Farnham Dep. at 22:10–23:2; Kapoor Aff. ¶ 5.)
8. The EDA covers two Penterra pharmaceutical products: (a) Oncalaris® (pegvisomant-axel), in both 20 mg and 40 mg vials; and (b) Renuvesta® (cilosporin-beta), in 5 mg capsules. These products are defined in Section 1.1 and the Recitals of the EDA. (EDA § 1.1 and Recitals, Exh. 3.)
9. Section 2.1 of the EDA provides, in pertinent part: "Supplier hereby grants to Distributor the exclusive right to distribute the Products within the Territory, as defined in Exhibit A." (EDA § 2.1, Exh. 3.)
10. Exhibit A to the EDA defines the "Territory" as follows: "The states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont (collectively, the 'New England States')." (EDA, Exhibit A, Exh. 3.)
11. Section 2.3 of the EDA expressly restricts Vantage's distribution activities outside the defined Territory: "Distributor shall not actively solicit orders for, or deliver, the Products outside the Territory without Supplier's prior written consent." (EDA § 2.3, Exh. 3.)
12. Section 5.2 of the EDA required Vantage, as Distributor, to purchase a minimum of $9.5 million of Oncalaris® per year, calculated at wholesale acquisition cost ("WAC"), during each year of the Agreement's term. (EDA § 5.2, Exh. 3.)
13. Section 13.1 of the EDA contains an anti-oral-modification provision, providing in full: "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." (EDA § 13.1, Exh. 3.)
14. Section 14.8 of the EDA contains a standard integration clause, providing: "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." (EDA § 14.8, Exh. 3.)
15. Section 14.2 of the EDA provides that the 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. (EDA § 14.2, Exh. 3.)
16. The EDA has an initial term of five (5) years, commencing on July 1, 2017, and expiring on June 30, 2022, with two successive one-year automatic renewal options unless either party provided at least 180 days' written notice of non-renewal prior to the expiration of the then-current term. (EDA § 3.1, Exh. 3.)
III. Vantage's Performance Under the EDA
17. In fiscal year 2018, Vantage purchased $11.2 million of Oncalaris® from Penterra, exceeding the annual minimum purchase commitment of $9.5 million set forth in Section 5.2 of the EDA by $1.7 million. (Penterra Accounts Receivable Records — Vantage Oncalaris® Purchases (FY 2018–2021), Exh. 4; Farnham Dep. at 34:15–35:6.)
18. In fiscal year 2019, Vantage purchased $14.8 million of Oncalaris® from Penterra, exceeding the annual minimum purchase commitment of $9.5 million by $5.3 million. (Exh. 4; Farnham Dep. at 35:7–36:1.)
19. In fiscal year 2020, Vantage purchased $18.3 million of Oncalaris® from Penterra, exceeding the annual minimum purchase commitment of $9.5 million by $8.8 million. (Exh. 4; Farnham Dep. at 36:2–37:9.)
20. For the nine-month period ending March 2021 of fiscal year 2021, Vantage purchased $16.1 million of Oncalaris® from Penterra. When annualized, this figure equates to approximately $21.47 million in Oncalaris® purchases for the full fiscal year. (Exh. 4; Farnham Dep. at 37:10–38:4.)
IV. The January 12, 2018 Kapoor Email
21. On January 12, 2018, Steven Kapoor, Penterra's Vice President of Commercial Operations, sent an email to Donald R. Farnham at Vantage. The email stated in full, as relevant: "Don — good catching up yesterday. We're definitely open to exploring expansion into NY/NJ/PA once your New England footprint is fully ramped. Let's circle back mid-year and see where things stand." (January 12, 2018 Email from S. Kapoor to D. Farnham, Exh. 5; Kapoor Aff. ¶ 8.)
22. Steven Kapoor testified at his deposition, taken on November 2, 2021, that the January 12, 2018 email expressed a willingness on Penterra's part to explore a potential future expansion of the Territory into the states of New York, New Jersey, and Pennsylvania, but that the email did not constitute prior written consent under Section 2.3 of the EDA, nor did it constitute or purport to be an amendment to Exhibit A of the EDA. (Deposition of Steven Kapoor ("Kapoor Dep."), taken November 2, 2021, at 47:12–49:18; Kapoor Aff. ¶¶ 9–10.)
23. There is no written instrument signed by both Penterra and Vantage amending Exhibit A of the EDA to include New York, New Jersey, or Pennsylvania within the defined Territory. (Kapoor Aff. ¶ 11; Farnham Dep. at 56:8–57:3.)
24. At his deposition taken on October 18, 2021, Donald R. Farnham admitted that he did not obtain, nor did Vantage execute, a signed written amendment to Exhibit A of the EDA expanding the Territory to include New York, New Jersey, or Pennsylvania. (Farnham Dep. at 56:8–57:3; 58:14–59:2.)
25. Donald R. Farnham further acknowledged at his deposition that no officer, director, or authorized representative of Penterra expressly authorized Vantage to distribute Oncalaris® in the tri-state area (New York, New Jersey, and Pennsylvania) in a signed writing. (Farnham Dep. at 59:3–60:11.)
V. Vantage's Unauthorized Distribution in the Tri-State Area
26. On or about September 14, 2020, Vantage began shipping Oncalaris® to hospitals and oncology clinics located in the states of New York, New Jersey, and Pennsylvania (collectively, the "tri-state area"). (Vantage Shipping Records, produced as Bates Nos. VMD-01103 through VMD-01287, Exh. 6; Farnham Dep. at 62:5–63:14; Deposition of Brian Kopec ("Kopec Dep."), taken November 9, 2021, at 28:9–29:17.)
27. Brian Kopec, Vantage's Outside Sales Director, directed and oversaw Vantage's sales efforts targeting hospitals and oncology clinics in New York, New Jersey, and Pennsylvania beginning in or around September 2020. (Kopec Dep. at 30:4–32:12.)
28. Between September 2020 and March 2021, Vantage generated approximately $6.4 million in revenues from the distribution of Oncalaris® to customers in the tri-state area (New York, New Jersey, and Pennsylvania). (Vantage Tri-State Sales Records, produced as Bates Nos. VMD-01288 through VMD-01356, Exh. 7; Farnham Dep. at 71:8–72:15.)
29. Penterra's distribution logistics systems directed Oncalaris® shipments to Vantage only for delivery to customers located at New England addresses within the six-state Territory defined in Exhibit A of the EDA. Penterra never authorized, directed, or facilitated shipments of Oncalaris® to tri-state customers through Vantage. (Affidavit of Rachel Mendez ("Mendez Aff.") ¶¶ 4–7; Deposition of Rachel Mendez ("Mendez Dep."), taken November 16, 2021, at 18:3–20:9.)
30. Rachel Mendez, Penterra's Director of Distribution & Logistics, confirmed in both her affidavit and deposition testimony that Penterra's internal distribution framework did not authorize or contemplate Vantage distributing Oncalaris® to customers located outside the six New England states. Penterra's supply chain and logistics systems were configured to support distribution within the contractually defined Territory only. (Mendez Aff. ¶¶ 5–6; Mendez Dep. at 21:14–23:8.)
31. Vantage's shipments of Oncalaris® into the tri-state area were made without Penterra's prior written consent, as required by Section 2.3 of the EDA. No document evidencing such prior written consent has been produced or identified in this litigation. (Kapoor Aff. ¶ 12; Mendez Aff. ¶ 7; Farnham Dep. at 56:8–60:11.)
VI. Penterra's Cease-and-Desist Letter and Vantage's Response
32. On March 8, 2021, Jennifer Chao, Penterra's Senior Vice President and General Counsel, sent a written cease-and-desist letter to Donald R. Farnham at Vantage. The letter demanded that Vantage immediately cease distributing Oncalaris® outside the six New England states defined in Exhibit A of the EDA, and that Vantage confirm in writing its compliance with Section 2.3 of the Agreement. (March 8, 2021 Letter from J. Chao to D. Farnham, Exh. 8.)
33. On March 22, 2021, Kenneth M. Rourke of Hargrove, Sinclair & Polk LLP, writing on behalf of Vantage, responded to Penterra's cease-and-desist letter. In the response, counsel for Vantage asserted that Vantage had obtained the right to distribute Oncalaris® in the tri-state area and further threatened a $35 million breach-of-contract and tortious interference counterclaim against Penterra if Penterra appointed a competing distributor in those states. (March 22, 2021 Letter from K. Rourke to J. Chao, Exh. 9.)
34. Vantage's claim that the January 12, 2018 Kapoor Email constituted written consent to expand the Territory is the sole documentary basis asserted by Vantage for its purported right to distribute Oncalaris® in the states of New York, New Jersey, and Pennsylvania. Vantage has not identified any other writing that could constitute consent or authorization under Section 2.3 of the EDA. (Farnham Dep. at 64:18–66:4; Vantage's Answer and Counterclaims ¶¶ 18–22.)
35. In its Answer and Counterclaims and through deposition testimony of Donald R. Farnham, Vantage has also asserted that Penterra's alleged course of dealing over a period of approximately three years — including Penterra's purported failure to object to certain Vantage shipments of Oncalaris® to New York that Vantage contends began in late 2019 — effected a modification of Exhibit A of the EDA. (Vantage's Answer and Counterclaims ¶¶ 23–26; Farnham Dep. at 67:1–69:12.)
VII. Penterra's Term Sheet with Meridian National Distributors, Inc.
36. On February 15, 2021, Penterra executed a term sheet with Meridian National Distributors, Inc. ("Meridian"), a New York corporation with its principal office located at 520 Seventh Avenue, 12th Floor, New York, New York 10018, concerning the distribution of Oncalaris® in the states of New York, New Jersey, Pennsylvania, and Maryland. (Term Sheet dated February 15, 2021, between Penterra and Meridian National Distributors, Inc., Exh. 10; Kapoor Aff. ¶ 13.)
37. Thomas Welliver is the President of Meridian National Distributors, Inc. and executed the February 15, 2021 term sheet on behalf of Meridian. (Term Sheet, Exh. 10.)
38. The distribution arrangement contemplated by the Penterra-Meridian term sheet stalled and was not consummated after Vantage asserted, through counsel, that its exclusive distribution rights under the EDA encompassed the tri-state area and threatened litigation against Penterra and any competing distributor appointed by Penterra in those states. (Kapoor Aff. ¶ 14; Exh. 9.)
VIII. No Written Amendment or Modification Exists
39. No signed written amendment, modification, or supplement to the EDA or to Exhibit A thereto has been executed by both Penterra and Vantage at any time during the period from July 1, 2017 through the present date. The comprehensive document production in this matter, which has included the exchange of thousands of documents between the parties, has not revealed the existence of any such instrument. (Kapoor Aff. ¶ 15; Farnham Dep. at 56:8–57:3, 58:14–60:11; comprehensive document production in this matter.)
40. No document signed by both Penterra and Vantage exists that expands the Territory beyond the states of Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont, as originally defined in Exhibit A of the EDA. (Kapoor Aff. ¶ 16; Farnham Dep. at 56:8–60:11.)
41. Section 14.5 of the EDA provides that any dispute arising under or in connection with the Agreement shall be submitted to the exclusive jurisdiction of the state or federal courts located in the Commonwealth of Massachusetts, and each party irrevocably consents to the personal jurisdiction of such courts. (EDA § 14.5, Exh. 3.)
Respectfully submitted,
PENTERRA PHARMACEUTICALS CORP., By its attorneys,
CALDERWOOD & HARKNESS LLP
By: ________
Linda Osei (BBO No. 672314) Priya Anand (BBO No. 698107) Hannah Brinkley (BBO No. 701482) Patrick Gallagher (BBO No. 704359)
CALDERWOOD & HARKNESS LLP 1 Federal Street, 35th Floor Boston, Massachusetts 02110 Telephone: (617) 555-7200 Facsimile: (617) 555-7201
Email: losei@calderwoodharkness.com
Dated: February 11, 2022
CERTIFICATE OF SERVICE
I, Linda Osei, hereby certify that on this 11th day of February, 2022, a true and correct copy of the foregoing Plaintiff Penterra Pharmaceuticals Corp.'s Statement of Undisputed Material Facts in Support of Its Motion for Summary Judgment Pursuant to Superior Court Rule 9A(b)(5), together with all exhibits referenced therein, was served upon counsel for Defendant Vantage Medical Distribution, LLC by electronic filing through the Court's electronic filing system and by depositing a copy in the United States mail, first-class postage prepaid, addressed as follows:
Kenneth M. Rourke, Esq. Alicia Fontaine, Esq. Hargrove, Sinclair & Polk LLP 200 Ashbury Asset Advisors, Suite 1800 Boston, Massachusetts 02109
________________________________________
Linda Osei
EXHIBIT LIST
The following exhibits are referenced in the foregoing Statement of Undisputed Material Facts and are filed contemporaneously herewith as part of Plaintiff's Appendix in Support of Its Motion for Summary Judgment:
PENTERRA PHARMACEUTICALS CORP.,
Plaintiff,
v. | Docket No. 2184-CV-01537-BLS
VANTAGE MEDICAL DISTRIBUTION, LLC,
Defendant.
Exhibit No. | Description
Exh. 1 | Penterra Pharmaceuticals Corp. Annual Report on Form 10-K for Fiscal Year 2021 (excerpts)
Exh. 2 | Vantage Medical Distribution, LLC Internal Financial Statements (Bates No. VMD-00412)
Exh. 3 | Exclusive Distribution Agreement dated July 1, 2017, by and between Penterra Pharmaceuticals Corp. and Vantage Medical Distribution, LLC, including Exhibit A (Territory)
Exh. 4 | Penterra Pharmaceuticals Corp. Accounts Receivable Records — Vantage Oncalaris® Purchases (FY 2018–2021)
Exh. 5 | January 12, 2018 Email from Steven Kapoor (Penterra) to Donald R. Farnham (Vantage)
Exh. 6 | Vantage Shipping Records (Bates Nos. VMD-01103 through VMD-01287)
Exh. 7 | Vantage Tri-State Sales Records (Bates Nos. VMD-01288 through VMD-01356)
Exh. 8 | March 8, 2021 Cease-and-Desist Letter from Jennifer Chao (Penterra) to Donald R. Farnham (Vantage)
Exh. 9 | March 22, 2021 Letter from Kenneth M. Rourke (Hargrove, Sinclair & Polk LLP) to Jennifer Chao (Penterra)
Exh. 10 | Term Sheet dated February 15, 2021, by and between Penterra Pharmaceuticals Corp. and Meridian National Distributors, Inc.

COMMONWEALTH OF MASSACHUSETTS

SUPERIOR COURT BUSINESS LITIGATION SESSION SUFFOLK COUNTY

STATEMENT OF UNDISPUTED MATERIAL FACTS

CALDERWOOD & HARKNESS LLP

CERTIFICATE OF SERVICE

EXHIBIT LIST

PENTERRA PHARMACEUTICALS CORP.,

VANTAGE MEDICAL DISTRIBUTION, LLC,

Record

Parties

Dates

Amounts