S.V. More Pharma Corporation v. Drugmakers Laboratories

Summary

This consolidated Supreme Court case involves a breach of contract dispute between pharmaceutical companies over exclusive manufacturing rights. S.V. More Pharma Corporation and Alberto Santillana were found liable for breaching their contractual obligation to maintain Drugmakers Laboratories as the exclusive manufacturer of 28 pharmaceutical products. The breach occurred when S.V. More contracted with Hizon Laboratories to manufacture some products without obtaining Drugmakers' required written consent, violating the exclusive manufacturing provision in their agreements. While the RTC and CA awarded PHP6,000,000 in actual damages, the Supreme Court found this amount erroneous due to lack of proper factual basis, as the breach lasted only seven days and affected only six products. The Court instead awarded PHP100,000 in temperate damages under Civil Code Article 2224, recognizing that while pecuniary loss occurred, its exact amount could not be proven with certainty. The decision emphasizes the importance of strict compliance with contractual exclusivity provisions in commercial relationships and the requirement for competent proof in damage awards.