11 November 2014Americas

PDL BioPharma buys share of Cerdelga royalties

Healthcare company PDL BioPharma has announced that it will soon gain royalties from sales of Sanofi’s Cerdelga (eliglustat) drug, used to treat Gaucher disease.

The news was confirmed when PDL announced it had bought a portion of the University of Michigan (U-M) worldwide royalty interest in Cerdelga for $65.6 million.

Under the terms of the agreement, PDL will receive 75% of all royalty payments due under U-M's license agreement with drug developer Genzyme, a subsidiary of Sanofi.

The rate used to calculate the royalties to be paid by Genzyme to U-M was not disclosed.

The deal will last until expiration of the licensed patents, excluding any patent term extension.

Cerdelga is an oral therapy for adults with Gaucher disease type 1. It was approved by the US Food and Drug Administration on August 19.

John McLaughlin, PDL’s president, said the acquisition of the Cerdelga royalties significantly added to the company’s already diversified portfolio of biopharmaceutical royalties.

Last year, PDL generated $450 million in royalty revenues from numerous marketed drugs—led by cancer drugs Avastin (bevacizumab), at around $144.5 million, and Herceptin (trastuzumab), which made around $141.6 million.

Kenneth Nisbet, associate vice president for research technology transfer at U-M, said the deal would enable it to accelerate investment in research and education.

“We strongly believe in Cerdelga's potential, which is why we have retained a portion of the royalty rights,” he added.

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