Mass. General sues pharma company it says agreed to pay it to test possible ALS drug in a trial, then stopped paying even before the hospital announced the drug was no good

Massachusetts General Hospital today sued a New York pharmaceutical company it says agreed to pay for the hospital's ALS center to test out a new drug against the currently incurable disease, then tried to worm its way out of its financial commitment after the hospital had already the work.

In its complaint, filed in US District Court in Boston, the hospital says Seelos Therapeutics owes it at least $4.7 million for work MGH's Healey Center did on a study of a drug called trehalose, which the company says it thinks might have some value in treating amyotrophic lateral sclerosis, or Lou Gehrig's Disease, which currently has no cure.

In order to help the company gain FDA approval, MGH says, the hospital negotiated a contract in 2020 under which its doctors, biostatisticians and other clinical-trial experts would design and run an early trial to test the drug on ALS patients, via a system the hospital has set up to try to speed the development of drugs for the disease.

In exchange for access to the platform trial, to extensive clinical trial design and management services, and to MGH’s physicians’ specialized expertise, Seelos agreed to make fixed payments to MGH to support the Study.

Seelos made a total of $2.5 million in payments towards the $7.2-million project, but then stopped making any additional payments, the hospital says, adding the company is now roughly $4.7 million in arrears.

MGH charges the company finally responded to its invoicing by demanding a $2-million discount because some of the patients were already taking another ALS drug, Relyvio, which was withdrawn from the market earlier this year because it didn't work.

However, as later pointed out by MGH’s legal counsel, both Study protocols executed by Seelos’s representatives on April 13, 2023 and October 10, 2023 explicitly contemplate the existence of patients receiving RELYVRIO® at baseline and starting RELYVRIO® post-baseline.

This past March, MGH reported patients given Seelos's drug did no better than patients given a placebo.

In addition to the $4.7 million it says it's directly owed, Mass. General says the company reneged on a promise to give the hospital a grant, of around $16 million, to support its ALS work.
In its complaint, the hospital is seeking payment of the $4.7 million, trebled, plus interest and attorneys' fees.