Healthcare corporation 3M has lost its dispute with representatives of the British Government over the company’s failure to market a diagnostic for MRSA developed within the Ministry of Defence.

The complainants have won $1.3 million in damages, whereas they were seeking $40 million – an outcome claimed by both sides as a success.

The BacLite medical device, which uses photoluminescence to detect MRSA bacteria, was purchased by 3M in 2007 and then abandoned as having failed the necessary clinical trials to support its marketing in the EU and the US.

The MoD, its spin-out company Ploughshare Innovations and private equity firm the Porton Group together claimed that 3M had deliberately mismanaged the BacLite trials in order to protect its rival (and more expensive) Fastman device.

The High Court in London found that 3M was in material breach of its obligation “actively to market” BacLite in the EU, the US, Canada and Australia, including its obligation to seek regulatory approval in the US.

However, it did not find that 3M had “intended” a breach of contract and thereby conducted the clinical trials dishonestly.

3M has announced its intention to pursue charges in the US against the Porton Group for alleged attempts to “extort” an out-of-court settlement by threatening to use political influence.

While the arguments rage on, the question of whether BacLite has the potential to improve worldwide treatment of MRSA remains unresolved.

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