Biogen Idec has decided to go cash-and-carry on Benlysta. The biotech company, which was in the marketing mix on the lupus drug with Human Genome Sciences, has sold its royalty rights to a private equity fund for an undisclosed amount. The drug is now under the control of GlaxoSmithKline, which in July cinched a deal to buy HGS.
Biogen ($BIIB) says only that DRI Capital Managed Fund will pay Biogen Idec "a multiple of certain of the royalties received for the period covering October 2011 to September 2014." Biogen will initially get $18.3 million from DRI for the arrangement. After 2014, all the royalty money goes to DRI, except for a "one-time contingency payment" if DRI hits some unspecified jackpot in royalty rewards.
Whether Benlysta will ever generate the kind of money it was first expected to is now the concern of GlaxoSmithKline ($GSK), which in July plunked down $3 billion to buy HGS. With the deal, GSK got full rights to Benlysta, the first new lupus drug approved in 50 years. Despite the fanfare when it was approved last year in the U.S. and European Union, the drug so far hasn't hit expectations.
Biogen Executive Vice President Steven H. Holtzman says the "sale of [the company's] Benlysta royalty and other rights allows us to accelerate payments that would otherwise have been spread over a longer time period." He said Biogen can use that money for the other drug launches it expects in multiple sclerosis, hemophilia, and amytrophic lateral sclerosis, or ALS.
There also is some anticipation that Biogen might be interested in buying Elan ($ELN) in the aftermath of its failed Phase III trial of its Alzheimer's drug. Biogen is partnered with Elan on its second-best selling multiple sclerosis therapy Tysabri, and a buyout of the Irish drugmaker would give Biogen full ownership of the blockbuster product.
- here's the release
Glaxo nabs HGS for $3B after months of wrangling
GSK's Benlysta gets another shot at U.K. market
Analysts: Ailing Elan casts buyout bait for Biogen Idec