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BIOGEN INC. 8-K Report, Agreement Terminated (Apr 2, 2013)

Filed April 2, 2013For Securities:BIIB

Summary

Biogen Idec (BIIB) announced on April 2, 2013, the completion of its acquisition of all remaining strategic, commercial, decision-making, and intellectual property rights to TYSABRI® (natalizumab) from Elan Pharma International Limited and Elan Pharmaceuticals, Inc. This transaction consolidates Biogen Idec's ownership and control over this key drug, which is used for treating multiple sclerosis and Crohn's disease. The acquisition involved an upfront payment of $3.25 billion in cash, funded by existing cash reserves. While Biogen Idec and Elan will continue to share TYSABRI profits equally until April 30, 2013, Biogen Idec will subsequently make contingent payments to Elan based on global net sales of TYSABRI. These payments are structured as 12% of net sales for the first twelve months, followed by 18% on sales up to $2.0 billion and 25% on sales exceeding $2.0 billion annually thereafter.

Key Highlights

  • 1Biogen Idec fully acquired all rights to TYSABRI® (natalizumab) from Elan.
  • 2The acquisition was completed on April 2, 2013.
  • 3An upfront payment of $3.25 billion in cash was made to Elan.
  • 4The upfront payment was funded by Biogen Idec's existing cash.
  • 5Biogen Idec and Elan will share TYSABRI profits equally until April 30, 2013.
  • 6Post-April 30, 2013, Biogen Idec will make contingent payments to Elan based on TYSABRI net sales.
  • 7The ANTEGREN Development and Marketing Collaboration Agreement was terminated.

Frequently Asked Questions

Biogen Idec paid an upfront cash payment of $3.25 billion. Additionally, contingent payments will be made to Elan based on future global net sales of TYSABRI, which will impact profitability based on sales performance.

TYSABRI® (natalizumab) is a medication used for the treatment of relapsing forms of multiple sclerosis (MS) and for inducing and maintaining clinical response in adult patients with moderately to severely active Crohn's disease.

By acquiring all strategic, commercial, decision-making, and intellectual property rights, Biogen Idec gains full control over the development, marketing, and commercialization of TYSABRI, simplifying its operations and strategic direction for the drug.

For the first twelve months after April 30, 2013, Biogen Idec will pay Elan 12% of global net sales of TYSABRI. Thereafter, the payment will be 18% of annual global net sales up to $2.0 billion, and 25% of annual global net sales exceeding $2.0 billion.