Care a2 Plus’ US partner claims $200m in lost profits from failed deal
The founder of Care A2 Plus changed product labelling approved by regulators in the United States, delaying the delivery of baby formula, the company’s distribution partner has alleged.
In documents filed in the Federal Court, Gensco Pharma alleges it will lose more than $200 million in future profits because of the failure of the agreement. The Florida-headquartered distributor also alleges Care A2 Plus misled it when it claimed to be able to produce up to 4.9 million tins of formula per month to supply the US, which was suffering from crippling shortages following contamination at a major plant early last year.
Care A2 Plus shot to prominence after gaining special access to the US, which had previously heavily restricted imports, in a move that surprised the market given the company’s small size and negligible sales. It was one of few companies globally – including Bubs Australia and later The a2 Milk Company – to gain entry to the tightly held market valued at $US4.3 billion.
Delaware Lt governor Bethany Hall-Long holding a tin of Care A2 Plus, purchased via Gensco Pharma which is now suing the formula maker in Australia.
The company said in an emailed statement it refuted all allegations.
“As the matter is currently before the Federal Court, they are unable to comment any further. Care A2 Plus otherwise looks forward to providing an update on the progress of their ASX Compliance Listing in due course,” their lawyer, Piper Alderman partner McKenzie Moore, said.
The legal stoush comes at a critical time for Care A2 Plus, which has been promising investors a listing on the ASX for several years. The company is already embroiled in a dispute with The a2 Milk Company, which has alleged the smaller group is infringing on
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