An Elmsford company that stopped manufacturing iodide tablets for preventing thyroid cancer claims that a company for which it used to make the product must still pay royalties.
Pharmacal Co. Inc. is demanding that Anbex Inc. pay royalties for every bottle of Iosat brand tablets sold in the past six years, in a complaint filed Dec. 16 in Westchester Supreme Court.
Iosat is one of three brands of potassium iodide tablets approved by the Food and Drug Administration, according to the Federal Trade Commission, for preventing thyroid cancer caused by exposure to radioactive iodide from, for example, nuclear power plants or weapons.
Pharmacal, previously known as Bartor Pharmacal Co., had developed “secret ingredients and a proprietary formulation … and proprietary procedure,” the complaint states, for making Iosat tablets.
In 1981, it made a deal to make Iosat exclusively for Anbex, of Williamsburgh, Virginia.
If Anbex needed to use a third-party manufacturer, Bartor would disclose its methods to the manufacturer, the complaint states, and Anbex would pay Bartor a royalty on every bottle sold.
If either company terminated the deal or breached the agreement, according to the complaint, Anbex “may not under any circumstances … manufacture, sell, promote or market the product.”
Bartor Pharmacal changed its name to Pharmacal Co. Inc. in 2012, according to a state Division of Corporations record, and Frank M. Bardani is the chief executive officer.
At some point, Pharmacal stopped manufacturing Iosat for Anbex, according to the complaint, and it disclosed its secrets so that another company could make the tablets. But for six years, Anbex has allegedly failed to pay royalties.
Pharmacal says it terminated the deal but Anbex has continued to market and sell Iosat. It is demanding  unspecified damages for unjust enrichment, breach of contract and breach of implied covenant of good faith and fair dealing.
Anbex did not respond to a message asking for its side of the story.
Pharmacal is represented by Woodbridge, New Jersey attorney Willard C. Shih.
