PDI and Novartis terminate accord

New Jersey, USA-based PDI, a provider of contract sales and commercialization services to the biopharmaceutical industry, says it  has agreed with Swiss drug major Novartis to terminate a promotion  agreement that was entered into in April 2008, whereby PDI deployed a  sales field force and provided other promotional activities to promote  the firm's branded product in the USA. PDI discontinued all promotional  activities related to the product effective as of April 22, 2009. In  connection with the termination of this agreement, Novartis will receive  credits for services that PDI is currently providing to Novartis under a  fee-for-service sales force agreement for another Novartis branded  product.

In the fourth quarter of 2008, PDI recorded a contract loss accrual of  around $10.3 million, representing the anticipated future deficit  expected to be incurred to fulfil its obligations under this contract  through February 1, 2010, which was the early termination date in the  contract. While PDI is currently evaluating the net impact on earnings  of the termination of this contract on April 22, 2009 and the credits to  be provided to Novartis for other services, it currently anticipates a  net positive impact on earnings.