Breaking News

Tweet TWEET

Biogen Idec to Acquire Full Rights and Control of TYSABRI® from Elan for Upfront Cash and Contingent Payments

  Biogen Idec to Acquire Full Rights and Control of TYSABRI® from Elan for
  Upfront Cash and Contingent Payments

  -- Biogen Idec gains all marketing, distribution and governance rights to
 TYSABRI in exchange for an upfront payment of $3.25Bn plus tiered contingent
             payments based on future TYSABRI worldwide sales --

-- Terminates TYSABRI collaboration agreement and eliminates change of control
                                 provision --

       -- Transaction is expected to be immediately accretive to EPS --

Business Wire

WESTON, Mass. -- February 6, 2013

Biogen Idec Inc. (NASDAQ: BIIB) today announced the company has agreed to
purchase Elan’s interest in TYSABRI (natalizumab) and upon closing will gain
full strategic, commercial and decision-making rights to TYSABRI. Upon the
closing of the transaction, the previous collaboration agreement between the
companies, whereby worldwide TYSABRI profits were split 50/50, will be
terminated along with the agreement’s change of control provisions.

Under the terms of the agreement, Biogen Idec will use its existing cash
reserves to make a payment of $3.25 billion to Elan upon the closing of the
transaction and make future contingent payments to Elan in an amount equal to
12% of global net sales of TYSABRI for the first twelve months, and
thereafter, Biogen Idec will continue to make contingent payments of 18% on
annual global net sales of TYSABRI up to $2.0 billion and 25% on annual global
net sales that exceed $2.0 billion. In 2014 only, the $2.0 billion threshold
will be pro-rated for the portion of 2014 remaining after the first 12 months
expires.

Biogen Idec anticipates the transaction will be approximately $0.20 to $0.30
accretive to 2013 GAAP earnings per share and $0.50 to $0.60 accretive to
non-GAAP earnings per share, and will continue to be accretive thereafter,
depending on the sales trajectory of TYSABRI.

“This is a natural next step for Biogen Idec and TYSABRI, and it underscores
our deep, long-term commitment to improving the lives of MS patients around
the world,” said George A. Scangos, Ph.D., chief executive officer of Biogen
Idec. “TYSABRI is a remarkably efficacious drug, and with the increased
awareness of our risk stratification capabilities, we believe MS patients’ use
of TYSABRI will continue to expand over the long-term. Full ownership will
improve our ability to navigate its role as part of our leadership in MS. We
appreciate Elan’s tremendous partnership and the productive approach to our
discussions that led to a transaction that benefits the shareholders of both
companies. We expect a smooth transition to the closing of the transaction.”

The transaction has been approved by the boards of directors of both companies
and is subject to the customary review process under the Hart–Scott–Rodino
Antitrust Improvements Act in the United States and other customary review
processes. The transaction is expected to close by the end of the second
quarter, assuming a standard regulatory approval timeframe.

Centerview Partners LLC is acting as exclusive financial advisor to Biogen
Idec. Ropes & Gray LLP is acting as legal counsel to Biogen Idec.

Webcast

Biogen Idec will host a webcast to discuss this transaction today, February 6,
2013, at 8:00 a.m. ET/5:00 a.m. PT. George Scangos, Chief Executive Officer,
Biogen Idec, will lead the call.

The call will be broadcast via the internet and will be accessible through the
Investors section of Biogen Idec's homepage, www.biogenidec.com. Supplemental
information in the form of a slide presentation will also be accessible at the
same location on the internet at the time of the conference call and will be
subsequently available on the website for one month.

About TYSABRI

TYSABRI is approved in more than 65 countries. TYSABRI is approved in the
United States as a monotherapy for relapsing forms of MS, generally for
patients who have had an inadequate response to, or are unable to tolerate, an
alternative MS therapy. In the European Union, it is approved for highly
active relapsing-remitting MS (RRMS) in adult patients who have failed to
respond to beta interferon or have rapidly evolving, severe RRMS.

TYSABRI has advanced the treatment of MS patients with its established
efficacy. Data from the Phase 3 AFFIRM trial, which was published in the New
England Journal of Medicine, showed that after two years, TYSABRI treatment
led to a 68 percent relative reduction (p<0.001) in the annualized relapse
rate when compared with placebo and reduced the relative risk of disability
progression by 42-54 percent (p<0.001).

TYSABRI increases the risk of progressive multifocal leukoencephalopathy
(PML), an opportunistic viral infection of the brain which usually leads to
death or severe disability. Infection by the JC virus (JCV) is required for
the development of PML and patients who are anti-JCV antibody positive have a
higher risk of developing PML. Factors that increase the risk of PML are
presence of anti-JCV antibodies, prior immunosuppressant use, and longer
TYSABRI treatment duration. Patients who have all three risk factors have the
highest risk of developing PML. Other serious adverse events that have
occurred in TYSABRI-treated patients include hypersensitivity reactions (e.g.,
anaphylaxis) and infections, including opportunistic and other atypical
infections. Clinically significant liver injury has also been reported in the
post-marketing setting. A list of adverse events can be found in the full
TYSABRI product labeling for each country where it is approved.

TYSABRI is marketed and distributed by Biogen Idec Inc. and Elan Corporation,
plc. For full prescribing information and more information about TYSABRI,
please visit www.biogenidec.com.

About Biogen Idec

Biogen Idec uses cutting-edge science to discover, develop, manufacture and
market therapies for serious diseases with a focus on neurology, immunology
and hemophilia. Founded in 1978, Biogen Idec is the world's oldest independent
biotechnology company. Patients worldwide benefit from its leading multiple
sclerosis therapies and the company generates more than $5 billion in annual
revenues. For product labeling, press releases and additional information
about the company, please visit www.biogenidec.com.

About Elan

Elan Corporation, plc is a neuroscience-focused biotechnology company
committed to making a difference in the lives of patients and their families
by dedicating itself to bringing innovations in science to fill significant
unmet medical needs that continue to exist around the world. Elan shares trade
on the New York and Irish Stock Exchanges. For additional information about
Elan, please visit www.elan.com.

Biogen Idec Safe Harbor Statement

This press release contains forward-looking statements, including statements
about the expected accretion to earnings per share from the transaction,
TYSABRI’s growth prospects, the synergies we expect from the transaction, and
the closing of the transaction. 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 uncertainty inherent in regulatory review of the transaction, our
dependence on our three principal products, AVONEX^® (interferon beta-1a),
TYSABRI and RITUXAN^® (rituximab), the importance of TYSABRI’s sales growth,
uncertainty of success in commercializing and developing other products,
product competition, the occurrence of adverse safety events with our
products, changes in the availability of reimbursement for our products,
adverse market and economic conditions, our dependence on collaborations and
other third parties over which we may not always have full control, problems
with our manufacturing processes and our reliance on third parties, failure to
comply with government regulation, our ability to protect our intellectual
property rights and have sufficient rights to market our products together
with the cost of doing so, the risks of doing business internationally,
failure to manage our growth and execute our growth initiatives, charges and
other costs relating to our properties, fluctuations in our effective tax
rate, our ability to attract and retain qualified personnel, product liability
claims, fluctuations in our operating results, the market, interest and credit
risks associated with our portfolio of marketable securities, environmental
risks and the 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.

Non-GAAP Financial Measures

Our estimate of the transaction’s effect on non-GAAP earnings per share
excludes the impact of our projected amortization of the upfront cash payment
and related amounts and the income tax effect related to such amortization. We
believe that the disclosure of this non-GAAP estimate provides additional
insight into the ongoing economics of our business and reflects how we manage
our business internally, set operational goals and forms the basis of our
management incentive programs.

Contact:

Biogen Idec Media Contacts:
Biogen Idec
Lindsey Smith, 781-464-3260
Senior Manager, Public Affairs
or
Biogen Idec
Daniel McIntyre, 781-464-3260
Senior Vice President, Public Affairs
or
Biogen Idec Investor Contacts:
Biogen Idec
Ben Strain, 781-464-2442
Senior Manager, Investor Relations
or
Biogen Idec
Claudine Prowse, Ph.D., 781-464-2442
Vice President, Investor Relations
 
Press spacebar to pause and continue. Press esc to stop.