Biogen to Pay $1.25B in Exchange for License
Agreement to Forward Pharma Intellectual Property
Future Payment of Royalties Subject to
Resolution of Ongoing Patent Procedures in US and EU
Biogen Inc. (NASDAQ: BIIB) today announced that it has agreed to
enter into a settlement and license agreement with Forward Pharma,
subject to the approval of Forward Pharma’s shareholders and other
customary conditions. The license agreement will provide Biogen an
irrevocable license to all intellectual property owned by Forward
Pharma.
Upon the effectiveness of the settlement and license agreement,
Biogen will provide Forward Pharma a cash payment of $1.25 billion.
Under certain circumstances outlined in the agreement, Biogen will
pay Forward Pharma royalties on net sales of Biogen products for
the treatment of multiple sclerosis that are covered by a Forward
Pharma patent and have dimethyl fumarate (“DMF”) as an active
pharmaceutical ingredient.
“We are very pleased to have reached this settlement with
Forward Pharma. We believe this agreement will clarify and
strengthen our intellectual property for TECFIDERA, the leading
oral therapy for multiple sclerosis,” said Michel Vounatsos, Chief
Executive Officer of Biogen.
The settlement and license agreement does not resolve the issues
pending in the ongoing Interference Proceeding in the U.S. or the
Opposition Proceeding in the EU. Biogen and Forward Pharma intend
to permit the Patent Trial and Appeal Board (PTAB), the U.S. Court
of Appeals for the Federal Circuit, the European Patent Office, and
the Technical Board of Appeal and the Enlarged Board of Appeal,
make a final determination in the proceedings before them.
Summary of Details and Conditions of
the Agreement
The agreement to enter into a settlement and license agreement
(the “License Agreement”) announced today was reached between
Biogen’s wholly owned subsidiaries, Biogen Swiss Manufacturing GmbH
and Biogen International Holding Ltd., and Forward Pharma A/S, a
Danish limited liability company (“Forward Pharma”) and additional
related parties and is subject to the approval of Forward Pharma’s
shareholders and other customary conditions. The approval of
two-thirds of Forward Pharma’s voting share capital is required to
approve the License Agreement. Shareholders representing
approximately 77% of Forward Pharma’s voting share capital have
irrevocably agreed to vote in favor of the License Agreement.
Forward Pharma has agreed to convene an extraordinary general
meeting on February 1, 2017 to obtain the approval of its
shareholders.
The License Agreement will have a perpetual term and provide for
the grant to Biogen of an irrevocable, co-exclusive license to all
intellectual property owned by Forward Pharma in the U.S. (the
“U.S. Licensed Intellectual Property”). The co-exclusive U.S.
license may be converted into an irrevocable exclusive license
subject to the conditions in the License Agreement, which include
the absence of legal restraints and the receipt of all necessary
regulatory approvals. The License Agreement will also provide for
the grant to Biogen of an irrevocable, exclusive license to all
intellectual owned by Forward Pharma anywhere else in the world
(collectively, the “Designated Countries Licensed Intellectual
Property”).
Upon the execution and delivery of the License Agreement, Biogen
will pay Forward Pharma a non-refundable cash payment of $1.25
billion which will not affect Biogen’s 2016 Non-GAAP financial
results. Under certain circumstances, Biogen will also be obligated
to pay Forward Pharma future royalties on net sales of Biogen
products for the treatment of multiple sclerosis that are covered
by a Forward Pharma patent and have dimethyl fumarate (“DMF”) as an
active pharmaceutical ingredient.
Biogen will only be obligated to pay Forward Pharma royalties in
the U.S. if Forward Pharma obtains patent rights covering treatment
of a human for multiple sclerosis by orally administering 480 mg
per day of DMF arising from the interference proceeding between the
Company and Forward Pharma that is currently pending at the Patent
Trial and Appeal Board (“PTAB”) of the United States Patent and
Trademark Office (the “Interference Proceeding”). If royalties are
payable in the U.S. and Biogen holds a co-exclusive license, a
royalty of 1% will be payable from January 1, 2023 until the
earlier of the expiration, unenforceability or invalidation of the
patents included in the U.S. Licensed Intellectual Property. If
Biogen holds an exclusive license, a royalty of 10% will be payable
from January 1, 2021 to December 31, 2028 and a royalty of 20% will
be payable from January 1, 2029 until the earlier of the
expiration, unenforceability or invalidation of the patents
included in the U.S. Licensed Intellectual Property.
Biogen will only be obligated to pay Forward Pharma royalties in
countries other than the U.S. if Forward Pharma obtains patent
rights covering treatment of a human for multiple sclerosis by
orally administering 480 mg per day of DMF in the opposition
proceeding against Forward Pharma’s European patent EP 2801355
(Application No. 14172398.1) (the “Opposition Proceeding”). If
royalties are payable in countries other than the U.S., a royalty
of 10% of Net Sales of applicable infringing products will be
payable on a country-by-country basis, from January 1, 2021 to
December 31, 2028, and a royalty of 20% will be payable on a
country-by-country basis from January 1, 2029 until the earlier of
the expiration, unenforceability or invalidation of the patents
included in the Designated Countries Licensed Intellectual Property
in each country.
The License Agreement does not resolve the issues pending in the
Interference Proceeding or the Opposition Proceeding. Biogen and
Forward Pharma intend to permit the PTAB and the U.S. Court of
Appeals for the Federal Circuit, as applicable, and the European
Patent Office and the Technical Board of Appeal and the Enlarged
Board of Appeal, as applicable, to make a final determination in
the proceedings before them.
About Biogen
Through cutting-edge science and medicine, Biogen discovers,
develops and delivers worldwide innovative therapies for people
living with serious neurological, autoimmune and rare diseases.
Founded in 1978, Biogen is one of the world’s oldest independent
biotechnology companies and patients worldwide benefit from its
leading multiple sclerosis and innovative hemophilia therapies. For
more information, please visit www.biogen.com. Follow us on
Twitter.
Safe Harbor
This press release contains forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, including statements relating to:
Biogen’s commercial business, the obligation to make, the
anticipated amount of, and the timing of, royalty payments under
the License Agreement, the timing, outcome and impact of
administrative, regulatory, legal and other proceedings related to
patents and other proprietary and intellectual property rights, the
strength and value of intellectual property rights, and the
approval of the License Agreement and the transactions contemplated
by the License Agreement by Forward Pharma’s shareholders and
regulatory authorities and tribunals. These forward-looking
statements may be accompanied by such words as “anticipate,”
“believe,” “could,” “estimate,” “expect,” “forecast,” “intend,”
“may,” “plan,” “potential,” “project,” “target,” “will” and other
words and terms of similar meaning. You should not place undue
reliance on these statements.
These statements involve risks and uncertainties that could
cause actual results to differ materially from those reflected in
such statements, including: risks relating to management and key
personnel changes; failure to compete effectively; difficulties in
obtaining and maintaining adequate coverage, pricing and
reimbursement for our products; potential future healthcare
reforms; the occurrence of adverse safety events; failure to
protect and enforce our data, intellectual property and other
proprietary rights and uncertainties relating to intellectual
property claims and challenges; uncertainty of success in
developing, licensing or acquiring other product candidates or
additional indications for existing products; and other risks and
uncertainties that are described in the Risk Factors section of our
most recent annual or quarterly report and in other reports we have
filed with the SEC.
These statements are based on our current beliefs and
expectations and speak only as of the date of this press release.
We do not undertake any obligation to publicly update any
forward-looking statements.
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version on businesswire.com: http://www.businesswire.com/news/home/20170117005802/en/
Biogen Media Contact:Biogen Inc.Jason Glashow,
781-464-3260orBiogen Investor Contact:Biogen Inc.Matt
Calistri, 781-464-2442
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