curasan and Stryker overcome commercial differences

•    EUR 4.5 million settlement ends legal dispute
•    Opportunity for future cooperation
•    Both parties open for further talks

Kleinostheim, June 22, 2015 – curasan AG (ISIN DE0005494538), a leading specialist in medicinal products for bone and tissue regeneration, successfully ended a long dispute with Stryker SA, the European subsidiary of the US company Stryker, by concluding a settlement agreement on 18 June 2015. In addition to a payment of EUR 4.5 million, both companies are open for talks about the possibility of curasan carrying out contract manufacturing for Stryker in the future.

curasan sued Stryker for damages in 2011 before the Duisburg Regional Court for breaching a distribution agreement. The Düsseldorf Higher Regional Court already ultimately confirmed the judgement of the Regional Court that curasan is entitled to compensation. However, no ruling has as yet been handed down on the amount of the damages. The proceedings before the court of first instance are still pending in this regard. After hardly any progress had been made in reaching a settlement in the past few years, a change in management at both companies paved the way for renewed talks about the dispute and the possibility of finding a joint solution.

According to the settlement that has now been reached, Stryker undertakes to pay curasan a total of EUR 4,500,000.00 by 2. July 2015. This will settle all the reciprocal claims of both companies arising from the distribution agreement that was concluded in February 2011. The parties also undertake to withdraw the pending lawsuit and consent to the withdrawal of the suit, respectively. The costs of the proceedings before the court of first instance will be paid by curasan, with the costs of the proceedings before the court of appeal being borne by Stryker.

Both companies have also decided to attach a special option to a part of the settlement payment. This option will make it possible – should a new OEM production agreement be concluded in the near future – for Stryker to set off EUR 500,000.00 of the settlement amount against the total amount of the contract. Notwithstanding the opportunities that this might create for both companies, neither Stryker nor curasan is under any obligation to actually conclude such an OEM production agreement. Should a production agreement not be concluded, the total settlement amount will remain EUR 4.5 million.

“It goes without saying that by agreeing on such an option we did not want to get straight back into the next round of contracts and regulations. With this settlement, we have together got rid of everything that could jeopardise any future business relationship between Stryker and curasan”, said Michael Schlenk, CEO of curasan. “Nevertheless, this option – which is entirely at the discretion of the parties – should give both sides an incentive to actively pursue the very promising general idea of long term cooperation in future. In doing so, we will be building a relationship where win-win thinking and mutual trust take centre stage.”

In anticipation of the signing the distribution agreement with Stryker in 2011, curasan expanded and further upgraded its own production facilities in Frankfurt am Main to the highest standards in the industry. In several audits, not only from German certification authority MDC, but as well from the US Food and Drugs Administration FDA, curasan was regularly certified for the high quality of its production facilities and processes. Thus a higher utilization of the facilities by third company OEM manufacturing is not only an interesting option for Stryker, but as well for other international companies in the Pharma and Biotech sector.

With the amicable resolution of the long-simmering differences with Stryker and the settlement payment, curasan can now give its full attention to its core business and achieving operational profitability in the long term. Following the highly successful – and substantially oversubscribed – capital increase that took place a few weeks ago and poured around a million euros of fresh liquidity into the company, curasan now plans to use over half of the settlement amount directly to discharge existing liabilities. “This means that we have reached another major milestone in curasan’s turnaround. If we set our liabilities off against our liquidity buffer, our positive net liquidity once again gives us enough of an impetus to successfully tackle what still lies ahead as well,” noted Schlenk.

As planned, curasan will publish further details on the expected development of the company in the current and next financial years at the upcoming annual shareholder meeting on 25 June 2015. At the same time, the company will inform the capital markets about these details by way of a press release.

Upcoming capital market events of curasan AG:

25.06.2015    2015 Annual Shareholder Meeting    Aschaffenburg