CALDERWOOD & HARKNESS LLP Tax Department
INTERVIEW SUMMARIES — KEY PERSONNEL OF PENTERRA BIOPHARMA INTERNATIONAL DAC (2017–2020)
ATTORNEY-CLIENT PRIVILEGED AND CONFIDENTIAL ATTORNEY WORK PRODUCT — PREPARED IN ANTICIPATION OF LITIGATION DO NOT DISTRIBUTE OR REPRODUCE WITHOUT AUTHORIZATION OF COUNSEL
Right-click to update Table of Contents
1. Introduction and Purpose
Calderwood & Harkness LLP ("C&H") was retained by Penterra Pharmaceuticals Corp. ("PPC") on June 2, 2022, to represent PPC in connection with a multi-year examination initiated by the Internal Revenue Service Large Business & International Division (Exam Team LB&I-NE-TP-2022-00641). The IRS examination challenges the transfer pricing methodology employed between PPC and its Irish subsidiary, Penterra Biopharma International DAC ("PBI"), for taxable years 2017 through 2020.
The IRS examination has raised issues in four principal areas: (a) the platform contribution transaction ("PCT") payment made by PBI upon its entry into a cost-sharing arrangement ("CSA") with PPC, effective July 1, 2012; (b) the cost-sharing ratios applied during the examination years under the CSA; (c) the royalty rate on legacy intellectual property licenses covering pre-CSA compounds; and (d) PBI's economic substance and performance of DEMPE functions — that is, the Development, Enhancement, Maintenance, Protection, and Exploitation of the intangible assets that generate PBI's non-Americas revenue.
The IRS has signaled, through its initial Information Document Requests ("IDRs") and informal communications with PPC's prior advisors, a position that PBI may lack sufficient economic substance to justify its role in the intercompany arrangements, and that key DEMPE functions remained in the United States under the direction and control of PPC personnel based at PPC's headquarters in Princeton Junction, New Jersey. If sustained, such a position could result in substantial transfer pricing adjustments reallocating income from PBI to PPC for U.S. federal income tax purposes.
In order to develop the factual record necessary to defend PPC's transfer pricing positions, C&H determined that a comprehensive program of personnel interviews with key PBI employees was essential. The purpose of the interviews was to document, in detail, the substantive decision-making, risk management, and control functions performed by PBI personnel at PBI's offices in Dublin, Ireland, and to develop evidence that would rebut any IRS contention that PBI lacked genuine operational independence or that key DEMPE functions were in fact directed by PPC personnel in the United States.
Twelve key PBI employees were identified and selected for in-person interviews. All interviews were conducted at PBI's offices at 4th Floor, Claremont House, Sandyford Business Park, Dublin D18 K7T4, Ireland, during the period from August 15 through September 23, 2022. The interviewees were selected to represent the full range of PBI's functional capabilities, including senior management, regulatory affairs, commercial strategy, medical affairs, supply chain operations, finance, legal and compliance, pharmacovigilance, market access and pricing, business development, human resources, and information technology.
The interviews were conducted by Garrett Simmons, Lead Associate, and Leila Nazari, Working Associate, both of the Tax Department of C&H, under the direction and supervision of Leonard Cross, Responsible Partner. In selected interviews, representatives of Whitmore Valuation Group LLC ("WVG") participated for the purpose of preparing the functional analysis and economic expert reports that will form part of PPC's defense. Specifically, Dr. Helena Vasquez and Dr. Rohan Chakrabarti of WVG attended certain interviews as identified in the individual summaries below and in Appendix A. The participation of WVG personnel was conducted pursuant to and in accordance with the Kovel arrangement documented under reference 1018-00009-KV, executed on June 20, 2022, under which WVG was retained by C&H as a consulting expert to provide valuation and economic analysis at the direction of counsel.
Additionally, coordination was undertaken with Thornbury & Keogh, PBI's Irish legal advisors, specifically Ciarán Thornbury, Lead Partner, regarding Irish employment law sensitivities and documentation protocols applicable to the conduct of employer-directed interviews in Ireland. Thornbury & Keogh confirmed that the interview protocols used by C&H were consistent with applicable Irish employment law requirements, including requirements related to employee notification and data protection.
This memorandum sets forth the summaries of all twelve interviews, identifies key themes and cross-cutting observations relevant to the IRS examination issues, catalogues the principal documents and evidence identified during the interview process, and provides recommendations for the incorporation of the interview evidence into PPC's defense strategy.
2. Interview Methodology
2.1. Format and Logistics
All twelve interviews were conducted in person at PBI's offices located at 4th Floor, Claremont House, Sandyford Business Park, Dublin D18 K7T4, Ireland. Each interview was scheduled for a duration of approximately 60 to 120 minutes, depending on the seniority and functional scope of the interviewee's role. In practice, several interviews with more senior personnel (particularly the Managing Director and the Head of Finance) ran slightly longer than the allotted time due to the breadth of topics covered.
Interview rooms were reserved by PBI's office management in advance of each session, and each interview was conducted in a private conference room setting. No PPC U.S. personnel were present during any interview.
2.2. Selection Criteria
Interviewees were selected based on four criteria: (a) functional role within PBI, with a focus on ensuring coverage of all material DEMPE-related functions; (b) seniority within the PBI organization, with priority given to individuals holding decision-making authority in their respective functional areas; (c) tenure at PBI, with preference for individuals who had been present during all or a substantial portion of the 2017–2020 examination period; and (d) relevance to the specific IRS examination issues, particularly those issues relating to PBI's economic substance and the allocation of DEMPE functions between PBI and PPC.
PBI grew from 52 employees at the time of its establishment in 2012 to 185 employees by the end of fiscal year 2020. The twelve interviewees selected for this interview program represent the most senior and functionally significant personnel within the PBI organization and collectively span all of PBI's principal operational functions.
2.3. Standardized Questionnaire
Each interview followed a standardized questionnaire designed to elicit consistent, comparable information across all interviewees. The questionnaire was developed by C&H in consultation with WVG and covered the following principal topics:
(a) Personal background, professional qualifications, and career history prior to joining PBI;
(b) Current job title, organizational reporting line, and team size;
(c) Detailed description of day-to-day responsibilities and scope of the interviewee's functional area;
(d) Nature and scope of decision-making authority, including identification of decisions that the interviewee makes independently and those requiring escalation to the PBI board or the Managing Director;
(e) Nature, frequency, and character of interactions with PPC U.S. personnel, including whether PPC U.S. personnel direct, approve, or exercise veto authority over any aspect of the interviewee's work;
(f) Specific contributions to each element of the DEMPE framework — Development, Enhancement, Maintenance, Protection, and Exploitation — as applicable to the interviewee's functional area;
(g) Market-specific activities and examples illustrating the exercise of independent judgment and decision-making;
(h) Risk-bearing responsibilities, including identification of commercial, regulatory, and operational risks borne by PBI;
(i) Identification of supporting documents — including board minutes, strategy presentations, regulatory filings, pricing analyses, contracts, and financial records — that corroborate the interviewee's statements regarding PBI's functions and decision-making authority; and
(j) Any other information that the interviewee considered relevant to PBI's operational independence and economic substance.
The full standardized questionnaire is reproduced in summary form in Appendix B to this memorandum.
2.4. Privilege and Confidentiality Protocols
At the commencement of each interview, the interviewee was informed that the interview was being conducted at the direction of counsel for purposes of legal representation of PPC, and that the communications during the interview were protected by attorney-client privilege and the attorney work-product doctrine. Interviewees were advised that the substance of their responses would be used in connection with the preparation of PPC's defense in the IRS examination and potentially in any subsequent administrative or judicial proceedings.
Interviewees were further advised that any documents they provided or identified during the interview process would be treated as confidential and privileged to the extent applicable, and that C&H would separately evaluate the privilege status of each document in connection with the broader document production.
2.5. Supporting Documents
Where relevant during the course of an interview, interviewees provided or identified supporting documents that corroborate the oral testimony provided. These documents include, among other things, PBI board minutes, annual strategic plans, pricing approval memoranda, regulatory submission records, distribution partner agreements, financial records, and employment records. All such documents have been collected and catalogued separately in C&H's document management system under Matter Number 1018-00009. A summary of the documents identified is set forth in Section 5 of this memorandum.
3. Interview Summaries
The following sections set forth a detailed summary of each of the twelve interviews conducted. For each interviewee, the summary includes the date of the interview, the identity of the interviewer(s) and any WVG participants, the interviewee's title, tenure, background, reporting line, key responsibilities, decision-making authority, interaction with PPC U.S. personnel, contributions to DEMPE functions, and key corroborating documents identified.
3.1. Aidan Naughton — Managing Director
Background and Qualifications. Mr. Naughton is an Irish national with over twenty-five years of experience in the pharmaceutical industry, with particular expertise in the commercialization of specialty pharmaceutical products outside the Americas. Prior to joining PBI as its founding Managing Director in March 2012, Mr. Naughton held senior executive positions at a major Irish pharmaceutical company, where he was responsible for the development and execution of commercial strategies across European and Asia-Pacific markets. He holds an undergraduate degree in chemistry from University College Dublin and a Master of Business Administration from the Smurfit Graduate Business School. Mr. Naughton's deep familiarity with the regulatory, pricing, and competitive landscape across EMEA and APAC markets was a central factor in his selection to lead PBI from its inception.
Reporting Line. Mr. Naughton reports directly to the PBI Board of Directors. He has a dotted-line coordination relationship with PPC's Chief Executive Officer, Catherine Falk, and Chief Financial Officer, Rajesh Iyer, on matters relating to group-wide strategic planning and coordination. Mr. Naughton emphasized during the interview that this dotted-line relationship is consultative in nature and does not involve directive authority by PPC U.S. executives over PBI's operations.
Key Responsibilities. Mr. Naughton bears overall strategic leadership responsibility for PBI's non-Americas operations, which span EMEA and APAC and encompass 68 country markets. His responsibilities include, but are not limited to, the following:
• Chairing PBI board meetings. During the examination period (2017–2020), PBI held a total of 42 board meetings, all of which took place in Dublin. These meetings were held on a quarterly basis with additional special sessions convened as required by significant commercial, regulatory, or strategic developments. Mr. Naughton chaired each of these meetings.
• Exercising final authority over PBI's pricing decisions across all 68 non-Americas country markets. Mr. Naughton described a structured pricing approval process under which country-level pricing proposals are developed by the Market Access & Pricing team, reviewed by the VP, Commercial Strategy, and submitted to Mr. Naughton for final approval.
• Approving market entry and exit decisions. Mr. Naughton determines whether and when PBI enters new country markets or exits existing ones, based on commercial viability assessments prepared by PBI's commercial strategy and business development teams.
• Selecting and approving distribution partners in markets where PBI does not maintain a direct sales presence. Mr. Naughton personally reviews and approves the selection of third-party distribution partners.
• Overseeing regulatory submissions and market authorizations outside the Americas. While the day-to-day management of regulatory affairs is delegated to Dr. Fiona Brennan (VP, Regulatory Affairs), Mr. Naughton retains oversight authority and is briefed regularly on the status of major regulatory submissions and marketing authorization applications.
• Managing PBI's annual operating budget and approving capital expenditure decisions. During the 2017–2020 period, PBI incurred cumulative regulatory expenditures of approximately €47.2 million. Mr. Naughton approved the budgets under which these expenditures were made.
• Negotiating and approving contracts with third-party distributors, supply chain partners, and service providers in PBI's non-Americas territory.
Decision-Making Authority. Mr. Naughton described himself as the ultimate decision-maker on all commercial and operational matters within PBI's territorial scope. He was emphatic that pricing decisions for PBI's three principal product lines — Veritaxol, Imvara, and Cerulon — across all 68 country markets are made independently by PBI, based on an assessment of local market conditions, competitive dynamics, the regulatory and reimbursement environment in each jurisdiction, and PBI's own margin targets and commercial strategy. He stated unequivocally that PPC's headquarters in Princeton Junction, New Jersey does not dictate, approve, or exercise veto authority over PBI's pricing decisions.
Mr. Naughton further described his authority over market entry and exit decisions, distribution partner selection, and the approval of PBI's annual strategic plans. He stated that these decisions are made by PBI's management team and approved by the PBI board, without requiring authorization from PPC U.S. management.
Interaction with PPC U.S. Personnel. Mr. Naughton participates in quarterly PPC global leadership meetings, which are typically conducted by videoconference, and visits PPC's Princeton Junction, New Jersey headquarters approximately twice per year for strategic planning sessions. He described these interactions as coordination and information-sharing sessions at which PPC and PBI exchange market intelligence, discuss pipeline developments, and align on high-level corporate strategy. He was clear that these interactions do not constitute direction or control of PBI's operations by PPC U.S. personnel. He noted that PPC and PBI each present their respective regional strategies and performance data, but that each entity's management team retains decision-making authority over its own territory.
DEMPE Contributions. Mr. Naughton's testimony supports a finding that PBI performs substantive functions across multiple DEMPE categories:
• Enhancement: PBI sponsors and manages local clinical studies and label extension programs designed to expand the approved indications for PBI's products in non-Americas markets.
• Maintenance: PBI operates an independent pharmacovigilance function (with its own EU QPPV) and manages ongoing regulatory compliance for all products in its territory.
• Protection: PBI manages the intellectual property enforcement strategy for PPC's pharmaceutical IP portfolio outside the Americas, retaining and directing local counsel in jurisdictions where IP enforcement actions are necessary.
• Exploitation: PBI bears full commercial responsibility for the non-Americas territory, including pricing, market access negotiations, distribution, sales operations, and revenue generation.
Key Corroborating Documents Identified. Mr. Naughton identified and directed the production of the following categories of documents:
• PBI board minutes for all 42 meetings held during the 2017–2020 period;
• PBI annual strategic plans for each of the fiscal years 2017 through 2020;
• Pricing approval memoranda for key country markets;
• Distribution partner agreements covering non-Americas territories;
• Regulatory submission records and associated expenditure detail.
Supporting Revenue Data. Mr. Naughton confirmed that PBI's territory generated total revenue of approximately €2.14 billion in fiscal year 2020, with pre-tax income of approximately €1.06 billion. He noted that PBI's revenue growth over the 2017–2020 period reflected both volume growth in existing markets and successful market entry into new territories.
3.2. Dr. Fiona Brennan — Vice President, Regulatory Affairs
Background and Qualifications. Dr. Brennan holds a PhD in pharmacology and has over fifteen years of experience in pharmaceutical regulatory affairs, with a particular focus on submissions to the European Medicines Agency ("EMA"), the United Kingdom's Medicines and Healthcare products Regulatory Agency ("MHRA"), and various national regulatory authorities across Europe and Asia-Pacific. Prior to joining PBI in 2013, Dr. Brennan led the regulatory affairs function at a mid-size Irish biotechnology company, where she managed the lifecycle of multiple product dossiers across European markets. Her expertise in navigating the complexities of the EU centralized and decentralized regulatory procedures was cited by Mr. Naughton as a key reason for her recruitment to PBI.
Reporting Line. Dr. Brennan reports directly to Aidan Naughton, Managing Director.
Key Responsibilities. Dr. Brennan leads PBI's regulatory strategy for all product submissions outside the Americas. She manages a team of 22 regulatory affairs professionals based in Dublin, organized into sub-teams responsible for different geographic regions and product lines. Her responsibilities encompass the following:
• Leading the preparation and submission of marketing authorization applications ("MAAs") for PBI's products to the EMA (via the centralized procedure) and to national regulatory authorities in EMEA and APAC jurisdictions;
• Managing post-authorization commitments, including variations, renewals, and condition-specific obligations imposed by regulatory authorities as part of marketing authorization approvals;
• Overseeing the adaptation and supplementation of regulatory dossiers to meet jurisdiction-specific requirements, including differences in clinical data requirements, labeling standards, and patient information leaflet formats;
• Coordinating directly with the EMA and national competent authorities on regulatory inquiries, requests for supplementary information, and inspection-related matters;
• Managing the cumulative regulatory expenditure budget, which totaled approximately €47.2 million during the 2017–2020 period. This expenditure encompasses fees paid to regulatory authorities, costs of local clinical studies required for market authorization, and costs of regulatory consulting services.
Dr. Brennan emphasized that PBI's regulatory submissions are not routed through PPC's U.S. regulatory affairs team. While PBI receives clinical data packages and Chemistry, Manufacturing, and Controls ("CMC") data from PPC's R&D teams in the United States — which is standard practice in the pharmaceutical industry, as the originating R&D function typically generates the core clinical and manufacturing data — PBI independently adapts, supplements, and submits these data packages to meet the requirements of non-U.S. regulatory authorities. This adaptation work is substantive and often involves the design and execution of additional clinical studies, the preparation of jurisdiction-specific risk management plans, and the development of regulatory strategies tailored to the requirements of individual national authorities.
Decision-Making Authority. Dr. Brennan makes independent decisions on regulatory strategy, submission timing, and content for all non-Americas markets. She described, by way of example, instances in which PBI adapted the clinical dossier for Veritaxol to include additional efficacy and safety data specifically required by the EMA that were not part of the U.S. FDA submission. She also described instances in which PBI pursued label extension studies in European markets for indications that PPC had not sought in the United States, based on PBI's own assessment of the commercial opportunity and the regulatory pathway in Europe.
Dr. Brennan stated that she does not seek or require approval from PPC's U.S. regulatory affairs team for any regulatory decision within PBI's territory. Decisions regarding the timing of submissions, the scope of clinical data included in dossiers, the regulatory strategy for label extensions, and the management of post-authorization commitments are all made by Dr. Brennan and her team in Dublin, subject to discussion with Mr. Naughton on matters of strategic significance.
Interaction with PPC U.S. Personnel. Dr. Brennan described a professional working relationship with PPC's U.S. regulatory affairs team, characterized by the exchange of clinical and CMC data packages and periodic teleconferences to discuss global regulatory developments. She was clear, however, that these interactions are collaborative and informational in nature. PPC's U.S. regulatory affairs team does not direct PBI's regulatory strategy or exercise approval authority over PBI's submissions to non-U.S. regulators.
DEMPE Contributions. Dr. Brennan's testimony supports PBI's performance of DEMPE functions in the following categories:
• Enhancement: PBI sponsors and executes local regulatory submissions and label extension studies that expand the approved indications and the scope of marketing authorizations for PBI's products in non-Americas markets. These activities enhance the value of the underlying intellectual property by broadening the revenue-generating potential of the products outside the Americas.
• Maintenance: PBI manages ongoing post-marketing regulatory compliance for all products in its territory, including pharmacovigilance-related regulatory obligations, fulfillment of post-authorization commitments, and management of variations and renewals.
• Protection: PBI's regulatory lifecycle management activities — including the management of data exclusivity periods, supplementary protection certificates, and pediatric investigation plan obligations — contribute to the protection of the intellectual property associated with PBI's product portfolio.
Key Products Discussed. Dr. Brennan's testimony focused primarily on PBI's three principal product lines: Veritaxol (non-Americas net sales of approximately $1.34 billion in FY 2020), Imvara (non-Americas net sales of approximately $790 million in FY 2020), and Cerulon (non-Americas net sales of approximately $280 million in FY 2020). She provided detailed examples of regulatory activities undertaken by PBI with respect to each of these products.
3.3. Seán O'Callaghan — Vice President, Commercial Strategy
Background and Qualifications. Mr. O'Callaghan holds a Master of Business Administration and has extensive experience in pharmaceutical commercialization across European and Asian markets. Prior to joining PBI in 2014, he held progressively senior commercial roles at multinational pharmaceutical companies, with responsibility for product launch planning, competitive positioning, and distribution strategy in EMEA and APAC. His expertise in navigating the diverse pricing and reimbursement systems across European markets was a significant factor in his recruitment to PBI.
Reporting Line. Mr. O'Callaghan reports directly to Aidan Naughton, Managing Director.
Key Responsibilities. Mr. O'Callaghan develops and executes PBI's commercial strategy for all three key product lines — Veritaxol, Imvara, and Cerulon — across the EMEA and APAC regions. He manages a team of 18 commercial strategy and market access professionals based in Dublin. His responsibilities include the following:
• Leading market entry analyses for new country markets, including commercial viability assessments, competitive landscape analyses, and revenue forecasting;
• Developing competitive positioning strategies for each product line, tailored to the specific clinical and economic context of individual country markets;
• Overseeing pricing and reimbursement strategy development in coordination with Marcus Hennessy (Head of Market Access & Pricing);
• Planning and executing product launch campaigns across PBI's 68 country markets, including the development of launch timelines, marketing materials (subject to local regulatory review), and key opinion leader engagement strategies;
• Selecting and managing third-party distribution partners in markets where PBI does not maintain a direct commercial presence, including the negotiation of distribution terms and performance management of partner relationships;
• Setting country-level pricing independently, without requiring PPC U.S. approval. Mr. O'Callaghan described a pricing governance process in which country-level pricing proposals are developed by the Market Access & Pricing team, reviewed by Mr. O'Callaghan and his commercial strategy team, and submitted to Mr. Naughton for final approval. At no point in this process is approval sought from or provided by PPC U.S. personnel.
Decision-Making Authority. Mr. O'Callaghan described a fully autonomous pricing and market access function within PBI. He stated that pricing decisions for all PBI products are based on PBI's own market research, willingness-to-pay analyses, and health technology assessments conducted by PBI's in-house team. He emphasized that PBI does not adopt or follow PPC's Americas pricing; rather, PBI independently establishes pricing based on local competitive dynamics, payer requirements, and PBI's own commercial objectives.
Mr. O'Callaghan provided specific examples of country markets in which PBI set prices that diverged significantly from PPC's Americas pricing for the same products. He explained that these divergences reflect genuine differences in market conditions, payer requirements, and competitive landscapes between the Americas and the non-Americas markets served by PBI. He also described instances in which PBI elected to enter markets that PPC U.S. had declined to prioritize, based on PBI's independent assessment of the commercial opportunity.
Interaction with PPC U.S. Personnel. Mr. O'Callaghan shares market intelligence with PPC's global commercial team and attends global brand team meetings as what he described as an "equal participant." He was clear that PPC does not dictate PBI's commercial strategy, pricing, or market entry decisions. The global brand team meetings serve as a forum for information exchange and coordination on global brand messaging, but each regional entity retains decision-making authority over its own commercial operations.
DEMPE Contributions. Mr. O'Callaghan's testimony supports PBI's performance of the following DEMPE functions:
• Exploitation: PBI holds primary responsibility for the commercialization of PPC's pharmaceutical products outside the Americas, including all aspects of pricing, market access, distribution, and revenue generation across 68 country markets.
• Enhancement: PBI's market-specific product positioning and lifecycle management activities — including the adaptation of product messaging, the development of local clinical and health economic evidence, and the pursuit of new indications in non-Americas markets — enhance the commercial value of the underlying intellectual property.
Key Corroborating Documents Identified. Mr. O'Callaghan identified the following categories of documents in support of his testimony: country-level pricing files for each of the 68 markets, market entry business case analyses, distribution partner agreements, and product launch plans.
3.4. Dr. Clodagh Meehan — Director, Medical Affairs
Background and Qualifications. Dr. Meehan holds a Doctor of Medicine degree and has substantial experience in pharmaceutical medical affairs, including medical education, key opinion leader engagement, and the design and management of post-marketing clinical studies. Prior to joining PBI in 2015, she held medical affairs leadership positions at a European pharmaceutical company, where she was responsible for medical strategy across multiple therapeutic areas and multiple European markets.
Reporting Line. Dr. Meehan reports directly to Aidan Naughton, Managing Director.
Key Responsibilities. Dr. Meehan leads PBI's medical affairs function for all non-Americas territories, managing a team of 14 medical affairs professionals. Her responsibilities include:
• Designing and executing medical education programs targeted at healthcare professionals in EMEA and APAC markets, including symposia, continuing medical education events, and online medical education initiatives;
• Managing PBI's key opinion leader ("KOL") engagement programs, including the identification, cultivation, and management of relationships with leading clinicians and researchers in PBI's therapeutic areas across non-Americas markets;
• Organizing and conducting advisory boards with external clinical and scientific experts to inform PBI's medical strategy and gather insights on evolving clinical practice in non-Americas markets;
• Overseeing PBI's investigator-initiated study ("IIS") programs, through which PBI provides funding and scientific support to independent researchers conducting studies relevant to PBI's products in non-Americas markets;
• Managing post-marketing clinical studies and real-world evidence ("RWE") programs designed to generate clinical data specific to the patient populations and clinical contexts of non-Americas markets;
• Independently designing and executing medical communication strategies for PBI's product portfolio, including the development of scientific publications, congress presentations, and medical information materials tailored to non-Americas audiences.
Decision-Making Authority. Dr. Meehan independently initiates and approves medical affairs programs and expenditures without requiring sign-off or approval from PPC's U.S. medical affairs team. She described multiple instances in which PBI sponsored local clinical studies in European and Asian markets that were designed and executed entirely by PBI's medical affairs team in Dublin, in response to local clinical needs and market access requirements. These studies generated clinical evidence that was used by PBI's market access and regulatory affairs teams to support reimbursement negotiations and label extension applications in non-Americas markets.
Dr. Meehan noted that her team's medical affairs activities are funded through PBI's own operating budget and that she has discretionary authority over the allocation of medical affairs expenditures within the budget approved by Mr. Naughton.
Interaction with PPC U.S. Personnel. Dr. Meehan participates in periodic global medical affairs coordination calls with PPC's U.S. medical affairs team, at which clinical data, publication plans, and emerging scientific developments are discussed. She characterized these interactions as collaborative and informational. PPC's U.S. medical affairs team does not direct, approve, or exercise authority over PBI's medical affairs programs or spending.
DEMPE Contributions. Dr. Meehan's testimony supports PBI's performance of the following DEMPE functions:
• Enhancement: PBI's local clinical evidence generation, post-approval clinical studies, and real-world evidence programs contribute to the enhancement of the commercial and scientific value of PBI's products by expanding the clinical evidence base supporting their use in non-Americas markets.
• Maintenance: PBI's pharmacovigilance support activities and medical information services contribute to the ongoing maintenance of the product portfolio's regulatory standing and scientific credibility.
3.5. Patrick Dunne — Director, Supply Chain & Operations
Background and Qualifications. Mr. Dunne has extensive experience in pharmaceutical supply chain management, including end-to-end logistics, distribution, quality assurance, and supply planning. Prior to joining PBI in 2013, he held supply chain leadership roles at pharmaceutical and medical device companies, managing the distribution of products across European and international markets. He holds a degree in industrial engineering and has professional certifications in supply chain management.
Reporting Line. Mr. Dunne reports directly to Aidan Naughton, Managing Director.
Key Responsibilities. Mr. Dunne manages the complete supply chain for all PBI products, from manufacturing through final distribution to customers in non-Americas territories. His responsibilities include:
• Overseeing the contractual relationship with Penterra Manufacturing Ireland Ltd. ("PMI"), the group's contract manufacturing entity located at Ringaskiddy, Co. Cork, Ireland. PMI employs approximately 620 personnel and manufactures pharmaceutical products for both PBI (non-Americas supply) and PPC (Americas supply) under a cost-plus arrangement. Under the contract manufacturing agreement, PMI provides manufacturing services to PBI at cost plus an 8% markup. Mr. Dunne manages PBI's relationship with PMI, including production scheduling, quality assurance requirements, and batch release for non-Americas supply.
• Coordinating with PMI on production planning to ensure that manufacturing capacity is allocated to meet PBI's demand forecasts across 68 country markets. Mr. Dunne described a structured demand forecasting process in which PBI's commercial strategy team provides rolling forecasts by product, country, and presentation, which Mr. Dunne translates into production orders placed with PMI.
• Managing third-party logistics providers and cold-chain distribution requirements for the distribution of temperature-sensitive biologic products across PBI's non-Americas territory. Mr. Dunne selects and contracts with logistics providers independently, without PPC U.S. involvement.
• Ensuring compliance with good distribution practice ("GDP") requirements applicable in each jurisdiction where PBI's products are distributed.
• Bearing and managing inventory risk and supply interruption risk for non-Americas supply. Mr. Dunne emphasized that PBI, not PPC, bears the risk of inventory obsolescence, supply disruption, and logistics failures in the non-Americas territory.
Decision-Making Authority. Mr. Dunne described making independent supply planning decisions and negotiating directly with PMI and with third-party logistics providers. PBI — not PPC — determines order volumes, production scheduling priorities for non-Americas supply, and distribution timing. Mr. Dunne stated that he does not receive direction from PPC U.S. supply chain personnel regarding PBI's supply chain operations.
Interaction with PPC U.S. Personnel. Mr. Dunne participates in periodic global supply chain coordination meetings with PPC's U.S. supply chain team, at which production capacity allocation between PPC and PBI is discussed. He described these interactions as coordination sessions rather than directive interactions. PBI retains independent authority over its supply planning and distribution decisions.
DEMPE Contributions. Mr. Dunne's testimony supports PBI's performance of the following DEMPE functions:
• Exploitation: PBI's supply chain management and distribution function is a core component of its commercial exploitation of the product portfolio in non-Americas markets.
• Maintenance: PBI's quality assurance and supply continuity activities contribute to the maintenance of the product portfolio's commercial viability and regulatory standing.
Key Corroborating Documents Identified. Mr. Dunne identified the following documents: the PMI contract manufacturing agreement (including the cost + 8% markup terms), supply chain planning documents and demand forecasts, and contracts with third-party logistics providers.
3.6. Róisín Kavanagh — Head of Finance
Background and Qualifications. Ms. Kavanagh is a Chartered Accountant (ACA) and a Fellow of Chartered Accountants Ireland. Prior to joining PBI in 2014, she spent approximately eight years with a Big Four accounting firm in Dublin, where she specialized in audit and advisory services for clients in the pharmaceutical and life sciences sectors. Her experience at the Big Four firm included work on transfer pricing documentation and international tax advisory engagements, which she described as having prepared her for the financial management challenges of PBI's intercompany arrangements.
Reporting Line. Ms. Kavanagh reports directly to Aidan Naughton, Managing Director. She has a dotted-line coordination relationship with PPC's Chief Financial Officer, Rajesh Iyer, for purposes of group financial reporting consolidation and coordination on intercompany accounting matters. She was careful to emphasize that this dotted-line relationship does not involve direction or control by PPC's CFO over PBI's financial management decisions.
Key Responsibilities. Ms. Kavanagh manages PBI's financial reporting, budgeting, forecasting, and treasury operations, leading a team of 10 finance professionals based in Dublin. Her responsibilities include:
• Preparing PBI's Irish statutory financial statements in accordance with Irish GAAP and coordinating the audit of those financial statements;
• Managing PBI's relationship with Thornbury & Keogh (Ciarán Thornbury, Lead Partner) for Irish tax compliance, including the preparation and filing of PBI's Irish corporation tax returns and the computation of PBI's Knowledge Development box ("KDB") claims. PBI has claimed the KDB rate of 6.25% on qualifying intellectual property income from fiscal year 2016 onward, reflecting PBI's substantive R&D and IP-related activities in Ireland;
• Managing PBI's independent banking relationship with Glenmore Bank Ireland plc. PBI maintains its own bank accounts at Glenmore Bank Ireland plc and makes independent cash management, investment, and foreign exchange hedging decisions. Ms. Kavanagh emphasized that PBI's treasury operations are not managed or directed by PPC's U.S. treasury function;
• Overseeing the calculation of PBI's cost-sharing payments to PPC under the CSA. The cost-sharing payments are calculated by PBI's finance team using the reasonably anticipated benefits ("RAB") formula specified in the CSA, based on PBI's share of the group's anticipated global product revenues. Ms. Kavanagh described the calculation process in detail, including the inputs used, the forecasting methodology, and the reconciliation and true-up procedures applied at the end of each fiscal year;
• Managing PBI's transfer pricing documentation in coordination with Crestfield & Associates (Susan Lam, Transfer Pricing Partner), including the preparation of PBI's Irish country-by-country reports, local files, and master files;
• Providing financial data and analysis to support PBI's commercial strategy and pricing teams, including profitability analyses by product and by country market;
• Coordinating with PPC's U.S. finance team on group consolidation reporting and intercompany settlement processes.
Financial Data. Ms. Kavanagh confirmed the following key financial data points for PBI: FY 2020 revenue of approximately €2.14 billion; FY 2020 pre-tax income of approximately €1.06 billion. She noted that PBI's financial performance over the 2017–2020 period reflected steady growth in non-Americas product revenues, driven by volume growth in existing markets, successful market entry into new territories, and the impact of PBI's lifecycle management activities.
Decision-Making Authority. Ms. Kavanagh described managing an independent finance and treasury function. PBI maintains its own bank accounts, makes its own cash management decisions, and independently manages its foreign currency exposures. Ms. Kavanagh stated that PPC's U.S. treasury function does not direct or approve PBI's banking or cash management activities. She further described the CSA cost-sharing calculation process as one that is performed internally by PBI's finance team, based on the contractual terms of the CSA and PBI's own revenue forecasts, without direction by PPC U.S. finance personnel.
Interaction with PPC U.S. Personnel. Ms. Kavanagh interacts regularly with PPC's U.S. finance team for purposes of group financial reporting consolidation, intercompany balance reconciliation, and coordination on the timing of intercompany payments. She characterized these interactions as administrative coordination rather than direction or control. She participates in monthly group finance calls with PPC's CFO and controller, at which group-level financial results and forecasts are discussed.
DEMPE Contributions. Ms. Kavanagh's testimony supports PBI's performance of the following DEMPE functions:
• Exploitation: PBI's independent finance and treasury function supports the commercial exploitation of the product portfolio by managing the financial infrastructure that enables PBI's commercial operations across 68 country markets.
• Maintenance: PBI's intercompany compliance and cost-sharing administration activities contribute to the maintenance of the group's intercompany arrangements and transfer pricing documentation.
Key Corroborating Documents Identified. Ms. Kavanagh identified the following documents: PBI statutory financial statements for FY 2017 through FY 2020, Glenmore Bank Ireland plc account statements, CSA cost-sharing calculation workpapers for each year, Knowledge Development box computation workpapers, and transfer pricing documentation prepared in coordination with Crestfield & Associates.
3.7. Declan Farrell — Head of Legal & Compliance
Background and Qualifications. Mr. Farrell is a solicitor admitted to practice in Ireland and has extensive experience in pharmaceutical regulatory compliance, intellectual property law, and commercial contract negotiation. Prior to joining PBI in 2015, he practiced in the corporate and intellectual property departments of a leading Irish law firm, where he advised pharmaceutical and life sciences clients on IP licensing, enforcement, and regulatory compliance matters.
Reporting Line. Mr. Farrell reports directly to Aidan Naughton, Managing Director. He coordinates with PPC's General Counsel, Deborah Staines, on matters of group-wide legal strategy and policy, but he was clear that this coordination does not involve directive authority by PPC's legal department over PBI's legal function.
Key Responsibilities. Mr. Farrell manages PBI's in-house legal function, which consists of a team of five professionals, including two qualified solicitors and three paralegals. His responsibilities encompass the following:
• Overseeing all distribution, licensing, and commercial contracts entered into by PBI in connection with its non-Americas operations. Mr. Farrell reviews and negotiates the terms of these contracts on behalf of PBI, with authority to finalize agreements within established parameters and to escalate material or non-standard terms to Mr. Naughton or the PBI board as appropriate;
• Coordinating trademark and patent enforcement activities outside the Americas, retaining and directing local counsel in jurisdictions where enforcement actions are necessary. Mr. Farrell described PBI's management of multiple IP enforcement matters during the 2017–2020 period, including trademark infringement proceedings and patent challenge defenses in European and Asian jurisdictions;
• Managing PBI's regulatory compliance programs, including anti-bribery and anti-corruption compliance, data protection compliance (including GDPR compliance), and industry code compliance;
• Serving as corporate secretary for PBI's board meetings, including the preparation of board agendas, the recording of board minutes, and the maintenance of PBI's corporate minute books. In this capacity, Mr. Farrell has maintained records for all 42 board meetings held during the 2017–2020 period.
Decision-Making Authority. Mr. Farrell independently manages PBI's contract negotiations and IP enforcement actions. He described initiating and resolving intellectual property disputes in multiple jurisdictions outside the Americas without requiring approval from PPC's U.S. legal department. He noted that while he coordinates with PPC's General Counsel on matters with potential group-wide implications, the decision to initiate or settle IP enforcement actions in PBI's territory is made by Mr. Farrell and the PBI management team, not by PPC U.S. personnel.
Interaction with PPC U.S. Personnel. Mr. Farrell participates in periodic global legal coordination calls with PPC's General Counsel and legal team, at which legal developments, regulatory changes, and IP matters of group-wide significance are discussed. He was clear that these calls are informational and consultative in nature and do not involve directive authority by PPC's legal department over PBI's legal operations.
DEMPE Contributions. Mr. Farrell's testimony supports PBI's performance of the following DEMPE functions:
• Protection: PBI's IP enforcement and defense activities outside the Americas, conducted under Mr. Farrell's direction, constitute a substantive contribution to the protection of the group's intellectual property portfolio.
• Exploitation: PBI's contract management activities, including the negotiation and execution of distribution agreements and licensing arrangements, are a core component of PBI's commercial exploitation function.
• Maintenance: PBI's compliance and governance programs contribute to the ongoing maintenance of PBI's regulatory standing and corporate governance framework.
Key Corroborating Documents Identified. Mr. Farrell identified the following documents: PBI board minute books covering all 42 meetings during 2017–2020, IP enforcement records (including correspondence with local counsel, court filings, and settlement agreements), distribution agreements, and compliance policies and training materials.
3.8. Dr. Niamh Walsh — Head of Pharmacovigilance
Background and Qualifications. Dr. Walsh holds a PhD in clinical pharmacology and is designated as the Qualified Person for Pharmacovigilance ("QPPV") for PBI in the European Union. EU regulations require that each marketing authorization holder maintain a QPPV who is resident within the EU and who has personal responsibility for the establishment and management of the company's pharmacovigilance system. Dr. Walsh's appointment as PBI's QPPV reflects both her technical qualifications and PBI's genuine operational presence in the EU. Prior to joining PBI in 2016, Dr. Walsh held pharmacovigilance roles at pharmaceutical companies in Ireland and the United Kingdom.
Reporting Line. Dr. Walsh reports to Dr. Clodagh Meehan, Director of Medical Affairs.
Key Responsibilities. Dr. Walsh manages PBI's pharmacovigilance function for all products in the non-Americas territory, leading a team of eight pharmacovigilance professionals. Her responsibilities include:
• Establishing and operating PBI's pharmacovigilance system for the non-Americas territory, including adverse event case processing, signal detection, and benefit-risk assessment. Dr. Walsh emphasized that PBI operates an independent pharmacovigilance system that is separate from PPC's U.S. pharmacovigilance operation, though the two systems share adverse event data in accordance with global pharmacovigilance agreements and regulatory requirements;
• Managing adverse event reporting to the EMA and national competent authorities across EMEA and APAC jurisdictions, including the timely submission of individual case safety reports ("ICSRs"), periodic safety update reports ("PSURs"), and risk management plan ("RMP") updates;
• Conducting signal detection activities using PBI's own pharmacovigilance database, including quantitative signal detection analyses and periodic reviews of emerging safety data;
• Developing and maintaining risk management plans for PBI's products as required by EU and APAC regulatory authorities;
• Submitting periodic safety reports to the EMA and national competent authorities in compliance with applicable regulatory timelines.
Decision-Making Authority. Dr. Walsh independently manages PBI's pharmacovigilance system and makes safety-related regulatory decisions for the non-Americas territory. She does not require approval from PPC's U.S. pharmacovigilance team for safety-related communications to European or Asia-Pacific regulatory authorities. She described instances in which PBI issued safety communications to EU regulatory authorities in advance of or independently from any corresponding U.S. safety communications, based on PBI's own assessment of the safety signal and the applicable EU regulatory requirements.
Dr. Walsh noted that as QPPV, she has a personal legal obligation under EU pharmacovigilance legislation to ensure the adequacy of PBI's pharmacovigilance system and to report safety concerns to the regulatory authorities. This obligation is independent of and cannot be delegated to PPC U.S. personnel.
Interaction with PPC U.S. Personnel. Dr. Walsh participates in global pharmacovigilance coordination calls with PPC's U.S. pharmacovigilance team, at which safety data and signals are shared and discussed. She described these interactions as a global safety data exchange mechanism required by regulatory expectations, not as a control or directive relationship. PBI and PPC each maintain independent pharmacovigilance systems and make independent safety-related decisions for their respective territories.
DEMPE Contributions. Dr. Walsh's testimony supports PBI's performance of the following DEMPE functions:
• Maintenance: PBI's independent pharmacovigilance system and post-marketing safety surveillance activities are essential to the ongoing maintenance of the product portfolio's regulatory standing and marketing authorization status in non-Americas markets.
• Protection: PBI's compliance with pharmacovigilance regulatory requirements contributes to the protection of the product portfolio by ensuring that marketing authorizations are maintained and that safety-related regulatory risks are managed proactively.
3.9. Marcus Hennessy — Head of Market Access & Pricing
Background and Qualifications. Mr. Hennessy is a trained health economist with extensive experience in pharmaceutical pricing and reimbursement across European markets. Prior to joining PBI in 2015, he led the pricing and reimbursement function at a European pharmaceutical company, where he managed submissions to national payer bodies and health technology assessment ("HTA") agencies across more than twenty European markets. He holds a Master's degree in health economics from a leading European university.
Reporting Line. Mr. Hennessy reports to Seán O'Callaghan, Vice President of Commercial Strategy.
Key Responsibilities. Mr. Hennessy leads PBI's market access and pricing strategy team, which comprises 12 professionals with expertise in health economics, health technology assessment, and payer negotiations. His responsibilities include:
• Developing country-specific pricing proposals for each of PBI's product lines across 68 non-Americas country markets. These proposals are based on detailed analyses of health technology assessment requirements, reference pricing frameworks applicable in each jurisdiction, the competitive landscape, and PBI's internal margin targets;
• Negotiating directly with national payer bodies, reimbursement authorities, and health technology assessment agencies across PBI's territory. Mr. Hennessy described the negotiation process as complex and jurisdiction-specific, requiring deep understanding of the institutional frameworks, decision-making criteria, and political dynamics in each market;
• Establishing PBI's net pricing after accounting for rebates, discounts, managed access agreements, risk-sharing arrangements, and other pricing mechanisms employed across different markets;
• Preparing health economic dossiers and cost-effectiveness analyses to support reimbursement applications in markets that require formal health technology assessments as a condition of reimbursement;
• Monitoring reference pricing dynamics across European and APAC markets, including the impact of external reference pricing mechanisms that link reimbursement prices across jurisdictions.
Decision-Making Authority. Mr. Hennessy described a fully independent pricing function within PBI. He emphasized that PBI's pricing decisions are made without input, direction, or approval from PPC's U.S. commercial or pricing teams. PBI's pricing is determined based on PBI's own data, market intelligence, health economic models, and strategic objectives. He provided specific and detailed examples of country markets in which PBI's net prices for Veritaxol, Imvara, and Cerulon diverge significantly — in both directions — from the corresponding Americas prices set by PPC. He explained that these divergences are a natural consequence of the fundamentally different pricing and reimbursement systems, competitive environments, and payer expectations that prevail in PBI's non-Americas markets as compared to the Americas.
Mr. Hennessy also described instances in which PBI negotiated managed access agreements and risk-sharing arrangements with payer bodies that have no equivalent in PPC's Americas pricing structure, further illustrating the independence and distinctiveness of PBI's pricing function.
Interaction with PPC U.S. Personnel. Mr. Hennessy stated that he does not consult with or seek guidance from PPC's U.S. pricing team in developing PBI's country-level pricing proposals. He participates in global commercial strategy meetings at which market access trends and pricing developments are discussed at a high level, but these meetings do not involve directive input from PPC U.S. personnel on PBI's pricing decisions.
DEMPE Contributions. Mr. Hennessy's testimony supports PBI's performance of the following DEMPE functions:
• Exploitation: PBI's pricing and market access function is a core component of its commercial exploitation of the product portfolio in non-Americas markets. The ability to negotiate favorable pricing and reimbursement terms directly determines PBI's revenue and profitability across its territory.
• Enhancement: PBI's health economic analyses and value demonstration activities contribute to the enhancement of the commercial value of the underlying intellectual property by establishing the clinical and economic value proposition of PBI's products in non-Americas markets.
Key Corroborating Documents Identified. Mr. Hennessy identified the following documents: pricing approval memoranda by country (covering all 68 markets), records of reimbursement negotiations with national payer bodies, and health technology assessment dossiers submitted by PBI to national HTA agencies.
3.10. Dr. Tomás Burke — Director, Business Development
Background and Qualifications. Dr. Burke holds a PhD in molecular biology and a Master of Business Administration. He has extensive business development experience in the pharmaceutical industry, spanning licensing transactions, partnership negotiations, and strategic alliance management. Prior to joining PBI in 2016, he held business development roles at pharmaceutical companies in Ireland and the United Kingdom, where he was responsible for sourcing, evaluating, and executing licensing and collaboration agreements.
Reporting Line. Dr. Burke reports directly to Aidan Naughton, Managing Director.
Key Responsibilities. Dr. Burke leads PBI's business development activities for the non-Americas territory, managing a team of four business development professionals. His responsibilities include: