Biogen Idec to make $3.2b upfront payment to buy full rights to the MS drug Tysabri
Biogen Idec Inc. has agreed to make an upfront payment of $3.2 billion as well as future contingent payments to acquire the full rights to the multiple sclerosis drug Tysabri from its Irish partner Elan Corp. Plc, which owns 50 percent, Biogen Idec said.
The deal would give the Weston biotech complete control of Tysabri, its fastest growing product, which many doctors and patients view as one of the most effective therapies now on the market in treating MS. The autoimmune disease affects the brain and central nervous system of an estimated 400,000 people in the United States and 2.5 million globally.
Biogen Idec last year rang up $1.1 billion from sales of Tysabri, second only to its lead MS drug Avonex, which generated 2012 revenue of $2.9 billion, according to the company’s financial report released last week. The company is also awaiting Food and Drug Administration approval of its much anticipated MS pill, BG-12, and has another MS drug in clinical development.
Under the deal, Biogen Idec will terminate its collaboration with Elan, the Dublin-based drug maker that developed Tysabri, and buy Elan’s remaining 50 percent interest. Going forward, Biogen Idec will control all marketing and distribution rights, Biogen Idec said in a press release.
In exchange, Biogen Idec will make a $3.25 billion cash payment to Elan when the deal is completed. It will also make future contigent payments to Elan equal to 12 percent of Tysabri’s global sales for the first year. After that, Biogen Idec will make contingent payments of 18 percent on annual sales of Tysabri up to $2 billion and 25 percent on annual 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,” Biogen Idec chief executive George Scangos said in prepared statement. “Full ownership will improve our ability to navigate its role as part of our leadership in MS.”
Tysabri was temporarily pulled from the market in 2005 after some patients died from a rare brain infection called progressive multifocal leukoencephalopathy, or PML. But Biogen Idec has since developed a test to predict which patients might be vulnerable to the infection.
While it retains its global leadership in MS treatments, Biogen Idec faces increased competition. One of its rivals, Cambridge-based Genzyme, last week said the FDA had accepted for review its revised application to sell the experimental drug Lemtrada in the United States. If approved, that drug is expected to vie with Tysabri in the market for “high efficacy” MS therapies.Robert Weisman can be reached at email@example.com.