Elan, Biogen change terms of Tysabri collaboration
Biogen Idec will take over full ownership of the multiple sclerosis treatment Tysabri from its partner Irish drugmaker Elan Corp. PLC in exchange for a $3.25 billion cash payment and royalties on future sales.
The drug developers currently split earnings from Tysabri, but Elan said the new deal will give it capital for investing and growing its business.
Under the new terms, Elan will receive a royalty of 12 percent of global Tysabri sales for the first 12 months. It will then receive a royalty of 18 percent on up to $2 billion of global sales and 25 percent on more than $2 billion.
The boards of both companies have approved the deal, which is expected to close by the end of the second quarter.
Biogen Idec Inc., based in Weston, Mass., expects the deal to add between 20 cents and 30 cents to its 2013 earnings per share.
Tysabri is a form of multiple sclerosis that cycles between stages of relapse and remission.
Biogen shares rose $3.64, or 2.3 percent, to $161 in trading Wednesday after rising as high as $167.35 earlier in the session. That was an all-time high, according to FactSet.