On February 5, 2024, MorphoSys AG (“MorphoSys”) and Novartis announced they had entered into an agreement by which Novartis would acquire MorphoSys for €68 per share.
As part of its July 2021 strategic funding partnership with MorphoSys, Royalty Pharma plc (“Royalty Pharma”) committed up to $2.025 billion in funding to MorphoSys to enable the acquisition of Constellation Pharmaceuticals in exchange for royalties, development funding bonds and equity.
Royalty Pharma is entitled to royalties on the following therapies:
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3% royalty on future net sales of pelabresib, a bromodomain and extra-terminal (BET) inhibitor for myelofibrosis, in development by MorphoSys. A New Drug Application (NDA) for pelabresib is expected to be submitted in the United States and European Union in mid-2024 based on the results of the phase 3 MANIFEST-2 study. |
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3% royalty on future net sales of tulmimetostat, a second-generation enhancer of zeste homolog 2 (EZH2) inhibitor, which is in phase 2 development by MorphoSys for the treatment of hematological malignancies and solid tumors. |
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Tiered, mid-single digit royalty on Tremfya, which is marketed by Johnson and Johnson for psoriasis and psoriatic arthritis, and generated sales of $3.1 billion in full-year 2023. |
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Tiered 3.3% to 4.2% effective royalty on future net sales of trontinemab for Alzheimer’s disease, in development by Roche. |
Royalty Pharma provided MorphoSys $300 million in exchange for Development Funding Bonds. MorphoSys will make 36 consecutive payments to Royalty Pharma totaling approximately $660 million (2.2 times the funded amount) to repay the Development Funding Bonds, beginning in the fourth quarter of 2024.
Royalty Pharma also acquired 1,337,552 shares of MorphoSys which would be valued at approximately $100 million at Novartis’ proposed acquisition price and current foreign exchange rates.
Forward-Looking Statements
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