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Perez v. Progenics Pharms., Inc.

United States District Court, S.D. New York

July 24, 2013

JULIO PEREZ, Plaintiff,
v.
PROGENICS PHARMACEUTICALS, INC., Defendant

Page 354

Julio Perez, Plaintiff, Pro se, Tarrytown, New York.

For Defendant: Eric David Raphan, Esq., Jonathan Stoler, Esq., Sheppard, Mullin, Richter & Hampton, LLP, New York, New York.

OPINION

Page 355

OPINION AND ORDER

KENNETH M. KARAS, UNITED STATES DISTRICT JUDGE.

Plaintiff Julio Perez, proceeding pro se, brings this action against Defendant Progenics Pharmaceuticals, Inc. (" Progenics" ), alleging that Defendant violated the Sarbanes-Oxley Act of 2002 (" Sarbanes-Oxley" ), 18 U.S.C. § 1514A, by terminating Plaintiff's employment in retaliation for a memorandum he wrote regarding a press release about a pharmaceutical drug. Defendant now moves for summary judgment. For the reasons stated herein, Defendant's Motion is denied.

I. Background

A. Factual Background

1. The Parties

The following facts are drawn from the Parties' submissions and are undisputed except as otherwise indicated. Progenics is a biotechnology company located in Tarrytown, New York and has been publicly traded on the NASDAQ stock exchange since 1997. (Def.'s Rule 56.1(a) Statement (" Def. 56.1" ) ¶ ¶ 1-2; Pl.'s Rule 56.1(a) Statement (" Pl. 56.1" ) ¶ ¶ 1-2; Decl. of Jonathan Stoler Ex. K (" Maddon Dep." ) 13.)[1] Plaintiff, who has a Ph.D. and a master's degree in organic chemistry, worked for approximately eleven years as a chemist at two pharmaceutical companies prior to his employment at Progenics. (Def. 56.1 ¶ ¶ 3-4; Pl. 56.1 ¶ ¶ 3-4; Decl. of Jonathan Stoler Ex. C (" Perez Dep." ) 40-43, 64-67; id . Ex. M (" Pl. Resume" ).) In May 2004, Progenics hired Plaintiff as a Senior Manager of Pharmaceutical Chemistry, a position he held during his entire employment with Progenics. (Def. 56.1 ¶ 5; Pl. 56.1 ¶ 5; Perez Dep. 70-73.) On May 3, 2004, Plaintiff signed an Employee Patent Assignment and Confidentiality Agreement, which required Plaintiff " to preserve in confidence, and not to use, to publish, or to otherwise disclose . . ., either during or subsequent to [Plaintiff's] employment, without the written permission of Progenics, all confidential proprietary rights or

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any knowledge, . . . or any other confidential information of Progenics, its customers, or others from whom Progenics has received information under obligations of confidence." (Def. 56.1 ¶ ¶ 6-7; Pl. 56.1 ¶ ¶ 6-7; Decl. of Jonathan Stoler Ex. L (" Confidentiality Agreement" ) ¶ 3; Perez Dep. 78.)

2. Relistor Development and Clinical Trials

While employed at Progenics, Plaintiff's primary responsibility was to support development of Relistor, a pharmaceutical drug designed to treat patients suffering from post-operative bowel dysfunction or opioid-induced constipation. (Def. 56.1 ¶ ¶ 8-9; Pl. 56.1 ¶ ¶ 8-9; Perez Dep. 73, 84-9; Decl. of Bruce Schneider (" Schneider Decl." ) ¶ 4.) Specifically, Plaintiff's responsibilities included working on Relistor's oral, subcutaneous, and intravenous formulations to " figur[e] out ways that the oral form of Relistor could be better absorbed by the human body," working on supply of the active pharmaceutical ingredient (methylnaltrexon) in Relistor, and supporting activities related to clinical trials--although Plantiff himself did not perform the clinical trials. (Def. 56.1 ¶ ¶ 10-11; Pl. 56.1 ¶ ¶ 10-11; Perez Dep. 75, 85-88.) The Parties agree that Plaintiff had no responsibility for the marketing and commercialization of Relistor; that Plaintiff did not hold any sales, marketing, or public relations positions; and that Plaintiff did not perform any job duties in those areas. (Def. 56.1 ¶ ¶ 11-12; Pl. 56.1 ¶ ¶ 11-12; Perez Dep. 53.)

In December 2005, Progenics and another pharmaceutical company, Wyeth Pharmaceuticals Division (" Wyeth" ), entered into a License and Co-Development Agreement (the " Progenics-Wyeth Agreement" ) to co-develop and jointly commercialize Relistor. (Def. 56.1 ¶ ¶ 13-14; Pl. 56.1 ¶ ¶ 13-14; Decl. of Jonathan Stoler Ex. N (" Progenics-Wyeth Agreement" ); Schneider Decl. ¶ 5.) The Progenics-Wyeth Agreement established three joint committees composed of members from both Progenics and Wyeth: a Joint Steering Committee (" JSC" ), a Joint Development Committee (" JDC" ), and a Joint Commercialization Committee (" JCC" ). (Progenics-Wyeth Agreement § 3.2-3.4.) The JSC was to be responsible " for the overall strategic and operational direction of the Parties' collaboration under th[e] Agreement" ; the JDC was tasked with " overseeing, coordinating and expediting the Development of the Compound and the Products" ; and the JCC was to " facilitate the exchange of information between the Parties regarding the Commercialization of the Products." [2] ( Id .; Def. 56.1 ¶ ¶ 15-17; Pl. 56.1 ¶ ¶ 15-17.) Pursuant to the Progenics-Wyeth Agreement, the companies also agreed to a Joint Development Plan to " govern all aspects of Development of the Products worldwide," which the JSC endorsed on or around May 11, 2006.[3] (Def. 56.1 ¶ ¶ 19-20; Pl. 56.1 ¶ ¶ 19-20; Progenics-Wyeth Agreement § 4.1; Decl. of Jonathan Stoler Ex. O (the " Development Plan" ); Schneider Decl. ¶ 8.)

The Development Plan included draft Target Product Profiles (the " TPP" ), " represent[ing] the technical and commercial targets." (Development Plan 7.) According to Defendant, the TPP was merely a " wish list" and a " marketing concept intended

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to help assess the commercial viability of a drug and its performance against competitive products." (Def. 56.1 ¶ ¶ 21-22; Maddon Dep. 56-57 (stating that TPP is " a phrase that describes the marketing" and is " generally established by commercial people" ); see also Decl. of Jonathan Stoler Ex. E (" Boyd Dep." ) 40; id . Ex. J (" Lukacsko Dep." ) 70, 74-75, 344, 358-59, 361; id . Ex. D (" Wong Dep." ) 153-54; Schneider Decl. ¶ 9.) According to Plaintiff, the TPP was more significant than a wish list: It " specifies the labeling concepts that are the goals of the drug development program [and] documents the specific studies intended to support the labeling concepts." (Pl. 56.1 ¶ 21; Decl. of Julio Perez Ex. 9 (" FDA TPP Guidance" ) 2 (also noting that " [t]he ideal version of what the sponsor would like to claim in labeling guides the design, conduct, and analysis of clinical trials to maximize the efficiency of the development program" (emphasis in original)); see also Perez Dep. 62-63 (listing commercial viability as only one of several factors in a drug's TPP); Boyd Dep. 40 (explaining that a TPP includes " cost of goods, clinical endpoints, commercial viability, things like that" ).)

In order to gain FDA approval for public sales of oral Reslistor, Progenics and Wyeth were required to conduct several phases of clinical trials demonstrating its safety and efficacy. (Def. 56.1 ¶ 28; Pl. 56.1 ¶ 28; Boyd Dep. 17; Decl. of Jonathan Stoler Ex. G (" Baker Dep." ) 46-49; Wong Dep. 119.) Each clinical trial phase had written protocols with primary and secondary endpoints. (Def. 56.1 ¶ 29; Pl. 56.1 ¶ 29; Wong Dep. 120, 132-33; Lukacsko Dep. 89-90; Boyd Dep. 99.) From October 2007 until April 2008, the companies conducted a Phase 2 clinical trial on a tablet formulation of oral Relistor (the " 2201 Study" ).[4] (Def. 56.1 ¶ ¶ 40-41; Pl. 56.1 ¶ ¶ 4041; Decl. of Jonathan Stoler Ex. T (" 2201 Study Final Report" ) 1; Schneider Decl. ¶ 18.) According to the written protocol, the 2201 Study was a " hypothesis generating trial," and " [t]he endpoints that w[ould] drive decision-making [we]re the proportion of subjects having a spontaneous bowel movement within 3 hours of the first dose of test article and the proportion of subjects discontinuing prematurely during the first week of active dosing for efficacy and tolerability respectively." [5] (Def. 56. 1 ¶ 42; Pl. 56.1 ¶ 42;

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Decl. of Jonathan Stoler Ex. S (" 2201 Study Protocol" ) 21-22; Maddon Dep. 44-45.) In any event, the 2201 Study demonstrated that the tablet formulation of oral Relistor showed statistically significant activity for some dosages, (Def. 56.1 ¶ 44; Pl. 56.1 ¶ 44; Lukacsko Dep. 197-98, 378-82, 449; Decl. of Jonathan Stoler Ex. U (" 2201 Study Results PowerPoint" ) 3856-61; id . Ex. W (" July 16, 2008 PowerPoint" ) 23-25; Schneider Decl. ¶ 21), but to date, there has been no Phase 3 clinical trial of this formulation, (Def. 56.1 ¶ 53; Pl. 56.1 ¶ 53).[6] Plaintiff claims that the 2201 Study did not show clinically important activity. (Pl. 56.1 ¶ 44; Decl. of Julio Perez Ex. 7 (" July 9, 2008 JDC/JSC Meeting Minutes" ) 2 (" The level of efficacy observed in the tablet study has marginal clinical or commercial value . . . ." ); Wyeth Update 32). On May 22, 2008, Wyeth and Progenics issued a joint press release, stating that " a [P]hase 2 trial[] evaluated the effects of an oral formulation of Relistor," which " showed positive activity," and " statistically significant activity as assessed by the occurrence of spontaneous bowel movements and other efficacy measures." The press release also included a quote from then Progenics CEO, Dr. Paul J. Maddon: " 'We are pleased by the preliminary findings of this oral formulation.'" (Def. 56.1 ¶ ¶ 48-49; Pl. 56.1 ¶ ¶ 48-49; Decl. of Jonathan Stoler Ex. V (the " May 2008 Press Release" ) 1-2.)

On July 16, 2008, executives in Wyeth's commercial operations and research and development groups presented the Relistor Development Strategy Update (the " Wyeth Update" ), to Wyeth's Executive Development Council. (Def. 56.1 ¶ ¶ 55-56; Pl. 56.1 ¶ ¶ 55-56; Wyeth Update; Schneider Decl. ¶ ¶ 26-27.) No Progenics employees, including Plaintiff, participated in the meeting. (Def. 56.1 ¶ 57; Pl. 56.1 ¶ 57; Baker Dep. 117; Boyd Dep. 232; Schneider Decl. ¶ 28.) The Wyeth Update assessed various oral formulations under development, specifically noting that " [r]esults from oral Phase 2 studies demonstrated that neither the tablet nor the capsule formulations had sufficient activity to satisfy the Confirm advancement criteria specified in the approved target product profile." (Wyeth Update 2, 34.) The Wyeth Update formally recommended that the tablet formulation not advance to Phase 3 clinical trials: Although some dosages of the tablet formulation demonstrated statistically significant results, and " rapid and predictable results" occurred with the first dose, (Def. 56.1 ¶ ¶ 61-62; Pl. 56.1 ¶ 61; Wyeth Update 23, 25), other targets for the drug were " not met," (Pl. 56.1 ¶ 62; Wyeth Update 32). According to Defendant, Wyeth decided to engage in further discussions with Progenics and review additional data before making a decision about advancing to Phase 3, (Def. 56.1 ¶ 65; Schneider Decl. ¶ 30), but Plaintiff claims that Wyeth endorsed the recommendation not to advance at the July 16, 2008 meeting, (Pl. 56.1 ¶ 65; Decl. of Julio Perez Ex. 12 (" July 16, 2008 Meeting Results" ) 4 (" DECISION: EDC endorsed the team's proposal to reconsider options for an oral Phase 3 program in JAN09." )).

In or around late July 2008, Mark Baker, general counsel of Progenics, received a copy of the Wyeth Update from Dr. Richard Krawiec, another employee of Progenics.[7] (Def. 56.1 ¶ 66; Pl. 56.1 ¶ 66;

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Baker Dep. 123-24.) Baker then distributed the Wyeth Update to five members of Progenics's senior management team, not including Plaintiff. (Def. 56.1 ¶ ¶ 69-70; Pl. 56.1 ¶ ¶ 69-70; Baker Dep. 172.) Plaintiff claims that " towards the end of July 2008," he received ...


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