LOS ANGELES — British conglomerate Reckitt Benckiser has been named in a $150 million lawsuit by California-based company Absorption Pharmaceuticals.
According to a news release, Absorption has alleged that Reckitt Benckiser stole propriety information from the company in order to develop a new product for market.
The issue originated in 2014 when Reckitt Benckiser began a merger and takeover of Absorption. The latter provided Reckitt Benckiser with extensive and often sensitive information including customer-sales statistics and new-product formulas. According to Absorption Pharmaceuticals CEO Jeff Abraham, the company was already considering a $150 million acquisition offer, but Reckitt Benckiser advised the company to hold off as they were also an interested party that could offer more money.
As Reckitt Benckiser is a manufacturer of well-known household items such as Lysol, Airwick, Mucinex and Woolite, Absorption's move to wait for the impending offer was not viewed as a poor move.
At the behest of Reckitt Benckiser, Absorption began sharing its documents to help the former get more-accurate insight into the company’s business practices. Among the items shared was Promescent, a spray intended to help with premature ejaculation. The formula was developed by the late Dr. Ron Gilbert, who was murdered in 2013.
Absorption has claimed that Reckitt Benckiser stole the formula for the spray and developed their own version to release to market known as K-Y Duration. The new product was launched in September 2016 around the same time the merger allegedly fell through.
Reckitt Benckiser had previously come under fire when a lawsuit was filed by 41 states and the District of Columbia against the company in regards to one of its top-selling products, Suboxone. The medication, which is used to treat opiate and opioid addictions, apparently did not adhere to the safety claims the company made to keep its production monopoly.
The 32-page complaint seeks $150 million dollars in compensatory damages, attorney fees, and exemplary damages.