Biogen Idec Sells BENLYSTA Royalty Rights to DRI Capital Managed Fund
-- Accelerated Royalty Payments to Support Ongoing R&D and Commercial Investments as Biogen Idec Prepares for Multiple Potential Product Launches in Coming Years --
WESTON, Mass. & TORONTO--(BUSINESS WIRE)--
Biogen Idec (BIIB) and DRI Capital today announced that Biogen Idec has sold to a DRI Capital managed fund (DRI) its royalty and other rights relating to BENLYSTA® (belimumab) to which Biogen Idec is entitled pursuant to a license agreement with Human Genome Sciences, Inc. and Glaxo Group Limited (both are companies within the GlaxoSmithKline group). BENLYSTA was approved by the US Food and Drug Administration in March 2011 and by the European Medicines Agency in July 2011 to treat systemic lupus erythematosus.
Under the terms of the agreement between Biogen Idec and DRI, Human Genome Sciences and Glaxo Group Limited will make royalty payments directly to DRI instead of to Biogen Idec. DRI will in turn pay Biogen Idec a multiple of certain of the royalties received for the period covering October 2011 to September 2014. Following that period, DRI will retain the royalty payments from the sales of BENLYSTA, with certain exceptions, including a one-time contingency payment that could be triggered if the cumulative royalties to DRI exceed an agreed amount. The multiple paid by DRI to Biogen Idec will vary by year and territory in which the royalties are generated. The initial payment by DRI to Biogen Idec, covering the royalty period from October 1, 2011 to March 30, 2012 is approximately $18.3 million and will be recognized into income as a gain in the third quarter. Biogen Idec will provide additional information about the full-year 2012 financial impact of this transaction as part of its third-quarter earnings reporting.
"The sale of our BENLYSTA royalty and other rights allows us to accelerate payments that would otherwise have been spread over a longer time period as we prepare for multiple pivotal trial data readouts and potential product launches in multiple sclerosis, hemophilia, and amytrophic lateral sclerosis, or ALS," said Steven H. Holtzman, Executive Vice President, Corporate Development at Biogen Idec. "The DRI team was professional, collaborative and responsive throughout the process, and we're pleased to have completed this transaction with them."
"We are pleased to have worked with Biogen Idec on this innovative transaction and to have once again utilized DRI Capital's innovative ARTS™ structure to acquire royalty and other rights related to BENLYSTA," said Gordon Winston, Managing Director of DRI Capital. "Like with previous sellers, DRI Capital's ARTS™ structure enables Biogen Idec to accelerate payments by selling its long-term royalty and related rights in exchange for larger payments over a shorter period. This deal is another example of DRI Capital's innovative efforts to unlock value for leading biotechnology and pharmaceutical companies. We are delighted that Biogen Idec intends to use the accelerated payments from this transaction to fund R&D and commercial investments in such important treatment areas."
About Biogen Idec
Through cutting-edge science and medicine, Biogen Idec discovers, develops and delivers to patients worldwide innovative therapies for the treatment of neurodegenerative diseases, hemophilia and autoimmune disorders. Founded in 1978, Biogen Idec is the world's oldest independent biotechnology company. Patients worldwide benefit from its leading multiple sclerosis therapies, and the company generates more than $5 billion in annual revenues. For product labeling, press releases and additional information about the company, please visit www.biogenidec.com.
About DRI Capital
Based in Toronto, Canada, DRI Capital Inc. (formerly Drug Royalty Corporation Inc.) is a life sciences industry-focused investment management firm with approximately US$2 billion under management that acquires royalties from universities, inventors, research institutes and pharmaceutical and biotechnology companies. This is the 19th royalty transaction completed by DRI Capital-managed funds over the past two and a half years. Royalties recently acquired by DRI Capital's managed funds include those on Johnson and Johnson's REMICADE®, Amgen and Pfizer's ENBREL® and Biogen Idec and Elan's TYSABRI®. Additional information about DRI Capital is available at www.dricapital.com.
Biogen Idec Safe Harbor Statement
This press release contains forward-looking statements, including statements about product development and commercialization. These forward-looking statements may be accompanied by such words as "anticipate," "believe," "estimate," "expect," "forecast," "intend," "may," "plan," "potential," "will" and other words and terms of similar meaning. You should not place undue reliance on these statements. Drug development and commercialization involve a high degree of risk. Factors which could cause actual results to differ materially from our current expectations include the risk that adverse safety events may occur, regulatory authorities may require additional information or may fail to approve any potential new therapy, reimbursement for our products may be limited or unavailable, we may encounter problems with our manufacturing processes, we may be unable to adequately protect our intellectual property rights, and the other risks and uncertainties that are described in the Risk Factors section of our most recent annual or quarterly report and in other reports Biogen Idec Inc. has filed with the SEC. These statements are based on current beliefs and expectations and speak only as of the date of this press release. We do not undertake any obligation to publicly update any forward-looking statements.
Biogen Idec Media Contact:
Amanda Galgay, 781-464-3260
Senior Manager, Public Affairs
Biogen Idec Investor Contact:
Kia Khaleghpour, 781-464-2442
Director, Investor Relations
DRI Capital Contact:
Gordon Winston, 416-324-5718