Elan Corporation has announced that it will pay Theravance $1 billion for a 21% participation interest in future royalty payments from sales of Breo (Relvar) Ellipta, Anoro Ellipta, MABA ‘081 bifunctional muscarinic antagonist-beta2 agonist monotherapy, and vilanterol monotherapy.
Elan CEO Kelly Martin explained, “This transaction, upon closing, will immediately diversify our business with an investment in four high quality and late stage clinical assets within a large and growing therapeutic area. This diversification should benefit our shareholders by spreading the inherent risk embedded in any one specific asset. In addition, the long term and future potential cash flow streams and net income will be shared with investors both directly – through a dividend pass through – and indirectly through overall after tax earnings. Being involved, even indirectly, with an important therapeutic area that addresses the needs of millions of patients who suffer from respiratory disease is particularly meaningful to all of us at Elan.”
Theravance CEO Rick Winningham said, “We are very excited to partner with Elan in a transaction that recognizes the significant value of four programs from our GSK collaborations targeted at respiratory disease. This agreement complements our strategy to facilitate and accelerate the return of capital to our stockholders and build value, consistent with our recently announced plan to separate Theravance into two entities, Royalty Management Company and Theravance Biopharma.”
Read the Elan and Theravance press release.
