A Lake County jury has awarded $93.8 million to north-suburban pharmaceutical company AbbVie Inc. in a dispute with a different drug-maker over the transfer price of a drug it agreed to market.

The record-setting verdict came Sept. 14 at the Waukegan courthouse following a two-week trial before Lake County Associate Judge Luis A. Berrones in a breach-of-contract suit between AbbVie Inc., based near North Chicago, and Maryland-based MedImmune LLC.

The agreement was formed in 1997 and amended in 2005 between MedImmune and Abbott International Inc., which spun off its pharmaceutical research operations as AbbVie in 2013.

Before this verdict, the highest jury award in Lake County was $33.2 million, awarded in a 2009 paraplegic case, according to John L. Kirkton of the Jury Verdict Reporter, a division of Law Bulletin Publishing Company.

The companies began their business relationship when Abbott agreed to be the exclusive distributor of the MedImmune drug Synagis — which prevents respiratory syncytial virus (RSV) infections in at-risk infants — in markets outside the U.S.

As a part of the 1997 agreement, Abbott agreed to pay MedImmune a certain price based on its net foreign sales of Synagis while it worked to market the drug and gain regulatory approval for it in additional countries.

MedImmune approached Abbott in 2005 regarding the development, promotion and distribution of a newer but similar drug, Numax, which was waiting for approval in the U.S. and other markets.

In an amended agreement entered in February 2005, Abbott agreed to fund Numax’s development through an increased price for Synagis. In exchange, it would receive sole distribution rights for Numax if it came to fruition.

However, anticipating potential development stops or delays, Abbott included certain “reversion events” that would reinstate the original price it paid for Synagis sales.

Among others, the events centered on factors such as Numax failing to receive regulatory approval in at least five major markets or MedImmune’s failure to send Abbott complete data and clinical study reports by December 2011.

MedImmune sought U.S. Food and Drug Administration approval for Numax in January 2008, but the company’s application was denied that November.

The FDA cited questions regarding the drug’s efficacy, safety and development program. The denial letter also requested additional data on reports of adverse neurological side effects and the link between developing anti-drug antibodies and hypersensitivity reactions so it could complete a safety evaluation.

MedImmune responded to the FDA in December 2009, but the company failed to cure the FDA’s concerns, according to AbbVie’s lawsuit.

In a 14-3 vote, the FDA’s Antiviral Advisory Committee declined to endorse Numax for licensure. In a second response letter, the FDA required MedImmune to withdraw its application and conduct more testing on the drug.

Numax got similar responses across the globe, as European Medicines Agency officials in 2005 and authorities in Germany in 2008 cited concerns over Numax’s risk/benefit profile in their reluctance to approve the drug.

Based on negative feedback from regulators, Abbott decided it would no longer pursue Numax approval outside of the U.S. It notified MedImmune about its decision in March 2011, contending that the lack of approval constituted a reversion event under the companies’ deal.

But MedImmune disagreed with Abbott’s position. It responded that under the agreement, a reversion event couldn’t happen until July 2012 at the earliest. It also contended Abbott failed to market the drug internationally on its end of the agreement.

Abbott alleged MedImmune should have reverted to the lower rates for Synagis as soon it dropped development of Numax sometime between 2009 and 2010.

Abbott sought contractually mandated negotiations in July 2011 before beginning arbitration, but MedImmune indicated no executives would be available until September 2011.

MedImmune then filed a lawsuit against Abbott in the U.S. District Court for the District of Maryland in August 2011, seeking a declaration of the parties’ rights and obligations under their agreement.

Abbott filed its breach-of-contract suit in Lake County Circuit Court a month later, alleging MedImmune failed to negotiate with Abbott in good faith. The company alleged MedImmune broke its contract by “repeatedly delaying and avoiding” scheduling negotiation sessions.

The suit also alleges MedImmune “attempted to extend the contracted negotiation period in bad faith as a means to prevent Abbott from pursuing its legal remedies” as outlined in their agreement.

In its answer, MedImmune contended Abbott’s allegations are inconsistent with the agreement the parties entered. It also admitted the amount of money in dispute “is at least millions of dollars” but denied Abbott was entitled to the relief it requested.

MedImmune also raised affirmative defenses, arguing Abbott declared in March 2011 that it would not seek regulatory approval in any foreign country. It argued that declaration broke their agreement before any alleged breach on MedImmune’s part and relieved it of any obligations under their distribution agreement.

MedImmune also contended it tried to extend the contractually mandated negotiation period “to accommodate work and vacation schedules for the parties’ principal negotiators during the summer months.”

MedImmune also countersued in the Lake County case, alleging that Abbott not only failed to submit a single application for regulatory approval outside of the U.S. but also failed to consistently identify when the alleged reversion event occurred. MedImmune also contended Abbott’s decision to stop pursuing regulatory approval was a unilateral one that wasn’t permitted through their agreement.

According to the verdict form, the jury found that MedImmune breached the provision of the agreement to comply with its obligation of good faith and fair dealing. It rejected MedImmune’s affirmative defense argument of waiver or estoppel for not performing the contract.

The jury found AbbVie proved it sustained damages based on a July 1, 2011 reversion date, and that MedImmune did not prove AbbVie had breached its obligations under the contract.

AbbVie was represented by James F. Hurst, partner at Kirkland & Ellis, and Stephen V. D’Amore and James F. Herbison, partners at Winston & Strawn. Hurst declined to comment on the ruling.

MedImmune was represented by Bryan R. Winter, a partner at Fuqua, Winter & Stiles Ltd. in Waukegan and Kevin T. Baine, Paul B. Gaffney and John M. McNichols of Williams & Connolly LLP in Washington, D.C.

They could not be reached for comment.

The case is AbbVie Inc. v. MedImmune LLC, 11 CH 4176.