Summary
Vertex Pharmaceuticals Inc. announced a significant amendment to its license, development, and commercialization agreement with Mitsubishi Tanabe Pharma Corporation, dated July 30, 2009. This amendment provides Vertex with an immediate cash infusion of $105.0 million, expected in the third quarter of 2009. Furthermore, Vertex is now eligible to receive additional milestone payments ranging from $15.0 million to $65.0 million in lieu of traditional royalties. This revised agreement grants Mitsubishi Tanabe Pharma Corporation a fully-paid license to commercialize telaprevir as part of a combination therapy for Hepatitis C Virus (HCV) infection in Japan and the Far East. It also includes rights for Mitsubishi Tanabe Pharma to manufacture telaprevir for sale in these specific regions. The deal signifies a strategic shift in how Vertex will monetize its telaprevir asset in this territory, focusing on upfront and milestone payments over future royalty streams.
Key Highlights
- 1Vertex Pharmaceuticals amended its agreement with Mitsubishi Tanabe Pharma Corporation on July 30, 2009.
- 2The company will receive $105.0 million in cash during the third quarter of 2009.
- 3Vertex is eligible for additional milestone payments totaling between $15.0 million and $65.0 million.
- 4These milestone payments will be received in lieu of royalties from sales in Japan and the Far East.
- 5The amended agreement grants Mitsubishi Tanabe Pharma a fully-paid license to commercialize telaprevir in a combination regimen for HCV.
- 6Mitsubishi Tanabe Pharma also gains rights to manufacture telaprevir for sale in Japan and the Far East.
- 7This amendment represents a significant financial event for Vertex, providing immediate capital and potential future revenue.