Genzyme Signs New Pact with Bayer – Zacks Tale of the Tape
Source: http://www.zacks.com/stock/news/18706/Genzyme+Signs+New+Pact+with+Bayer+-+Zacks+Tale+of+the+TapePosted on Tuesday, March 31st, 2009 | In Stocks to Watch
Genzyme Corp. (GENZ) said it acquired the worldwide rights of marketing leukemia treatment Campath and two other hematological-cancer drugs from its German partner Bayer for up to $650 million in royalties.
As part of the agreement, Genzyme will be responsible for developing Campath to treat multiple sclerosis (MS). However, Bayer will retain an option to co-promote the drug if it gets approval for MS and the right to commercialize Campath for use in organ transplantation.
After selling the rights of Campath, and blood cancer drugs Flurdara and Leukine to Genzyme, Bayer said it will focus on kidney and liver cancer drug Nexavar.
A Bayer spokesperson said the deal “significantly improves the profitability for two of our key franchises – oncology and MS”. The company has generated about 220 million euros ($293.2 million) annually from the three drugs.
On the other hand, the deal will generate $185 million in sales for Genzyme’s oncology segment in 2009 and up to $700 million over the next three years. The Cambridge, Massachusetts-based company also expects the transaction to add to its earnings per share.
Genzyme shares climbed more than 2% to $60.35 at noon on the NASDAQ.
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