- Vertex Retains all North American Rights -
- Janssen Obtains Exclusive Rights in Europe and Other Regions -
- Vertex to Receive $165 Million Upfront; Tiered Royalty Averaging
mid-20 Percent Range Based on Successful Commercialization -
NEW BRUNSWICK, N.J. and CAMBRIDGE, Mass., June 30 /PRNewswire-FirstCall/
-- Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX) and Janssen
Pharmaceutica, N.V., a Johnson & Johnson (NYSE: JNJ) company, announced today
that they will collaborate to develop and commercialize Vertex's
investigational hepatitis C virus (HCV) protease inhibitor, VX-950. Under the
agreement, Janssen will have exclusive rights in Europe, South America, the
Middle East, Africa and Australia, and Vertex will retain exclusive commercial
rights to VX-950 in North America. Tibotec Pharmaceuticals, Ltd., another
Johnson & Johnson company, will lead the development and commercialization of
VX-950 for Janssen.
"Janssen and Tibotec are committed to developing and commercializing
innovative and transformational products for viral diseases, and will
contribute important capabilities and resources that will strengthen our
global clinical, regulatory, manufacturing and commercial execution for the
VX-950 program," said Joshua Boger, Ph.D, President and Chief Executive
Officer of Vertex. "Our vision for transforming hepatitis C therapy is
closely aligned with that of Janssen and Tibotec, and we look forward to
working with them to ensure VX-950's rapid advancement in Europe and other
territories."
"Vertex shares with us the vision that VX-950 could represent a
significant step forward in treating the growing number of patients with
hepatitis C in the coming years," said Joseph Scodari, Worldwide Chairman,
Pharmaceuticals Group of Johnson & Johnson. "This agreement further reinforces
our established strong commitment to finding innovative treatments for global
viral diseases."
Terms of the Agreement
Under the terms of the agreement, Janssen receives exclusive rights to
commercialize VX-950 in Europe, South America, the Middle East, Africa and
Australia. Vertex will receive an upfront payment of $165 million upon
signing the contract. In addition, Vertex could receive up to $380 million
based on successful development and launch of VX-950 in the territories. The
agreement also includes a royalty on product sales in Europe and other
territories outside of North America and the Far East. Vertex will continue
to lead the global development plan for VX-950.
Vertex and Tibotec also announced today that the companies will establish
a global health initiative to increase the prevention, diagnosis, treatment
and cure of HCV infection to be principally directed toward developing
countries.
Key Financial Terms:
-- Upfront and milestones: Vertex expects to receive a total of $545
million in payments, including an upfront payment of $165 million upon
signing the contract, and a further $380 million in additional
contingent milestone payments based on the successful development and
approval of VX-950, and launch in the regions where Janssen
Pharmaceutica has commercial rights.
-- Royalties: a tiered royalty averaging a mid-20 percent range of net
sales in Janssen's regions and contingent upon successful
commercialization. In addition, Janssen will be responsible for
certain third party royalties in its regions.
-- Drug development costs: reimbursement of 50 percent of drug development
costs incurred by Vertex.
-- Commercial supply responsibilities: Vertex and Janssen will be
responsible for drug supply in their respective territories.
Mitsubishi Pharma holds development and commercial rights to VX-950 in
Japan and certain Far East countries, and is expected to commence clinical
development in its territories in the second half of 2006.
About VX-950
VX-950 is an investigational oral inhibitor of hepatitis C virus protease,
an enzyme essential for viral replication, and is one of the most advanced
investigational agents that specifically targets HCV. In clinical studies to
date, researchers have observed rapid and dramatic antiviral activity with
VX-950. In clinical studies of VX-950 to date, no patients have discontinued
treatment and no serious adverse events have been reported.
In May 2006, Vertex announced the details of a global Phase 2 program for
VX-950 consisting of three large clinical studies that are expected to enroll
approximately 1000 patients with HCV at clinical centers in the United States
and Europe. Vertex initiated the U.S.-based PROVE 1 study in May. The PROVE
2 study is being initiated in Europe.
About Hepatitis C
Hepatitis C is a liver disease caused by the infection by hepatitis C
virus (HCV), which is found in the blood of people with the disease. HCV, a
serious public health concern affecting 170 million people worldwide, is
spread through direct contact with the blood of an infected person. Though
many people with hepatitis C may not experience symptoms, others may have
symptoms such as jaundice, abdominal pain, fatigue and fever. Hepatitis C
significantly increases a person's risk of developing chronic liver disease,
cirrhosis, liver cancer and death. The burden of liver disease associated with
HCV infection is increasing, and current therapies only provide sustained
benefit in about 50% of patients with genotype 1 HCV, the most common strain
of the virus. Specifically targeted antiviral therapies for HCV in clinical
development may have the potential to increase the proportion of patients in
who the virus can be eradicated.
About Vertex
Vertex Pharmaceuticals Incorporated is a global biotechnology company
committed to the discovery and development of breakthrough small molecule
drugs for serious diseases. The Company's strategy is to commercialize its
products both independently and in collaboration with major pharmaceutical
companies. Vertex's product pipeline is principally focused on viral diseases,
inflammation, autoimmune diseases and cancer. Vertex co-promotes the HIV
protease inhibitor, Lexiva, with GlaxoSmithKline.
About Johnson & Johnson
Johnson & Johnson is the world's most comprehensive and broadly based
manufacturer of health care products, as well as a provider of related
services, for the consumer, pharmaceutical, and medical devices and
diagnostics markets. The more than 230 Johnson & Johnson operating companies
employ approximately 116,000 men and women in 57 countries and sell products
throughout the world.
About Janssen Pharmaceutica
Within the Johnson & Johnson group, Janssen Pharmaceutica is a worldwide
Center of Excellence for integrated R&D, production and general services. In
Belgium, the company has sites in Beerse, Geel and Olen, which together
account for a workforce of 4,350 persons. With more than 80 drugs to its
credit, the company is one of the most innovative in the world and its
products are used worldwide in human and animal medicine, and plant and
material protection.
About Tibotec
Tibotec Pharmaceuticals Ltd., based in Cork, Ireland, is a pharmaceutical
research and development company. The Company's main research and development
facilities are in Mechelen, Belgium with offices in Yardley, PA. Tibotec is
dedicated to the discovery and development of innovative HIV/AIDS drugs and
anti-infectives for diseases of high unmet medical need.
Conference Call and Webcast
Vertex Pharmaceuticals will host a conference call today, June 30, 2006 at
9:00 a.m. EDT to review the collaboration with Janssen on VX-950. This call
will be broadcast via the Internet at http://www.vrtx.com in the investor
center. Alternatively, to listen to the call on the telephone, dial
(800) 374-0296 (U.S. and Canada) or (706) 634-2224 (International).
Alternatively, Vertex is providing a podcast MP3 file available for download
on the Vertex website, http://www.vrtx.com.
The call will be available for replay via telephone commencing June 30,
2006 at 12:00 p.m. EDT running through 5:00 p.m. EDT on July 7, 2006. The
replay phone number for the US and Canada is (800) 642-1687. The
international replay number is (706) 645-9291 and the conference ID number is
2582280. Following the live webcast, an archived version will be available on
Vertex's website until 5:00 p.m. EDT on July 14, 2006.
Safe Harbor Statement
This press release contains "forward-looking statements" as defined in the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements, include the statement that VX-950 could represent a significant
step forward in treating the growing number of patients with hepatitis C in
the coming years; that Tibotec and Janssen will contribute important
capabilities and resources that will strengthen Vertex's global clinical,
regulatory and commercial execution for the VX-950 program; and that upon
successful development, approval and launch of VX-950 in the regions where
Janssen has commercial rights, Vertex could receive up to $380 million based
on successful development and launch of VX-950 in the territories, and could
receive tiered royalties in the mid-20 percent range. These statements are
based on current expectations of future events. If underlying assumptions
prove inaccurate or unknown risks or uncertainties materialize, actual results
could vary materially from Vertex's and Johnson & Johnson 's expectations and
projections. Risks and uncertainties include general industry conditions and
competition; economic conditions, such as interest rate and currency exchange
rate fluctuations; technological advances and patents attained by competitors;
challenges inherent in new product development, including obtaining regulatory
approvals; domestic and foreign health care reforms and governmental laws and
regulations; and trends toward health care cost containment. These risks and
uncertainties also include the risks that clinical trials for VX-950 may not
proceed as planned due to technical, scientific, or patient enrollment issues,
or disagreements with regulatory authorities over trial design or other
matters; that the scale and scope of future clinical and nonclinical studies
may change and will be determined in significant part by data collected in
ongoing and future trials; that further clinical studies of VX-950 may not
reflect the results obtained in early clinical and nonclinical studies; that
ongoing nonclinical studies, including toxicology studies, will yield
currently unanticipated negative outcomes that could adversely affect planned
clinical trials; that results from the Vertex's clinical trials commenced
during 2006 will be insufficient to support a Phase III program without
additional trials and consequent delay in the timetable for potential
approval; and that any potential product may not achieve sales in Janssen's
territory sufficient to earn the royalties referenced above. A further list
and description of these risks, uncertainties and other factors can be found
in the section entitled "Risk Factors" in Vertex's Annual Report on Form 10-K
for the fiscal year ended December 31, 2005 and in Exhibit 99 of Johnson &
Johnson's Annual Report on Form 10-K for the fiscal year ended January 1,
2006. Copies of these Form 10-K filings, as well as subsequent filings, are
available online at http://www.sec.gov or on request from the Vertex or
Johnson & Johnson. Neither Vertex nor Johnson & Johnson assumes any
obligation to update any forward-looking statements as a result of new
information or future events or developments.
Lexiva is a registered trademark of the GlaxoSmithKline group of
companies.
Vertex Contacts:
Lynne Brum, Vice President, Strategic Communications, (617) 444-6614
Michael Partridge, Director, Corporate Communications, (617) 444-6108
Lora Pike, Manager, Investor Relations, (617) 444-6755
Zachry Barber, Senior Media Relations Specialist, (617) 444-6470
Johnson & Johnson Contacts:
PR
Ben Plumley 011 32 473554670
Doug Arbesfeld 908-218-7592
Siegfried Marynissen 011 32 14605409
Daniel De Schryver 011 3227492770
IR
Stan Panasewicz 732-524-2524
Louise Mehrotra 732 524-6491
