Biogen Idec, Royalty Pharma deal

Royalty Pharma paid $510 million in cash to the former shareholders of Fumapharm AG to increase the firm's stake in sales milestones related to multiple sclerosis drug Tecfidera dimethyl fumarate ( BG-12) and psoriasis drug Fumaderm. The milestones are paid by Biogen Idec, which acquired Fumapharm in 2006 (see BioCentury, June 5, 2006).

The acquisition included a $220 million upfront payment, plus $15 million upon EU or U.S. approval of any Fumapharm product for MS, as well as sales milestones. The milestones are dependent upon prior 12-month sales and range from $22 million to $300 million. The milestones are triggered by the first $500 million in cumulative sales for Fumapharm products and by every $1 billion in cumulative sales, up to $20 billion. Royalty Pharma, which first acquired an undisclosed stake in the sales milestones for $761 million in May 2012, said it expects the lifetime earn-out rights to all former Fumapharm shareholders to total "north of $4 billion" (see BioCentury, May 7, 2012). ...