Biogen to pay US $3.35bn for full ownership of multiple sclerosis drug
Biogen has agreed to purchase Elan’s interest in Tysabri and upon closing will gain full strategic, commercial and decision-making rights to the multiple sclerosis drug.
Tysabri (natalizumab) is approved in over 65 countries around the world. In the United States, the drug is approved as a monotherapy for relapsing forms of MS, generally for patients who have had an inadequate response to, or are unable to tolerate, an alternative MS therapy. In the European Union, it is approved for highly active relapsing-remitting MS (RRMS) in adult patients who have failed to respond to beta interferon or have rapidly evolving, severe RRMS.
Upon the closing of the transaction, the previous collaboration agreement between the Biogen and Elan, whereby worldwide Tysabri profits were split 50/50, will be terminated along with the agreement’s change of control provisions.
Under the terms of the agreement, Biogen will use its existing cash reserves to make a payment of US $3.25 billion to Elan upon the closing of the transaction and make future contingent payments to Elan in an amount equal to 12% of global net sales of Tysabri for the first twelve months, and thereafter, Biogen will continue to make contingent payments of 18% on annual global net sales of Tysabri up to US $2 billion and 25% on annual global net sales that exceed $2 billion.
“This is a natural next step for Biogen Idec and TYSABRI, and it underscores our deep, long-term commitment to improving the lives of MS patients around the world. TYSABRI is a remarkably efficacious drug, and with the increased awareness of our risk stratification capabilities, we believe MS patients’ use of TYSABRI will continue to expand over the long-term. Full ownership will improve our ability to navigate its role as part of our leadership in MS. We appreciate Elan’s tremendous partnership and the productive approach to our discussions that led to a transaction that benefits the shareholders of both companies. We expect a smooth transition to the closing of the transaction.”
George A. Scangos, Ph.D., chief executive officer of Biogen Idec.
The transaction is expected to close by the end of the second quarter, assuming a standard regulatory approval timeframe.
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