An Edmonton biotechnology company has agreed to pay more than $1 million in cash and shares to settle long-standing royalty lawsuits.
AVAC Ltd. filed a claim against Ceapro Inc. and a subsidiary in 2011 regarding a royalty agreement that saw AVAC, a Calgary investment firm, provide funding for product innovation development in the area of veterinary therapeutics and active ingredients.
A year later, AVAC sought damages against Ceapro and another subsidiary over royalty agreements in which AVAC provided funding for product innovation development in areas including pre-diabetes and Type II diabetes screening and detection.
A judge awarded judgments last January worth a total of $1.9 million plus interest against Ceapro and subsidiaries, although Ceapro wasn’t responsible for the entire amount.
The company said in a news release Monday that under an agreement with AVAC the judgments will be satisfied by paying $780,741 cash and issuing 1,288,149 Ceapro common shares worth about 50 cents each.
Ceapro specializes in taking raw materials, such as oats and other plants, and turning them into active ingredients for cosmetic products and health care for humans and animals.
Incorporated in 1997, the company has a production facility in Leduc and research laboratories in Edmonton and Charlottetown, P.E.I.
Ceapro expanded its Edmonton facility in 2016, doubling staff to about 60 people in what Premier Rachel Notley called a good example of Alberta economic diversification.
The technology started in a University of Alberta research lab and was worked on by a graduate student later employed by Ceapro.