Labopharm and Angelini Complete the Restructuring of their Partnership
- Labopharm Transfers OLEPTRO™ to Angelini for U.S., Canada and Other Countries Globally in Exchange for a Royalty -
LAVAL, QC, Oct. 5, 2011 /CNW/ - Labopharm Inc. (TSX: DDS) and Gruppo Angelini (Angelini), its partner in the joint venture established by the two companies to commercialize OLEPTRO™ in the U.S., today announced that they have completed the previously announced restructuring of their partnership. Under the terms of the new agreement, Labopharm has granted Angelini an exclusive license and rights related to OLEPTRO™ in the U.S., Canada and other countries globally in exchange for a royalty on product sales. The two companies have terminated the existing joint venture agreement and ancillary agreements established in May 2010 and have dismantled the joint venture. Angelini has acquired Labopharm's 50% ownership interest in Angelini Labopharm, LLC. The Irish corporations related to the joint venture will be dissolved as part of the transaction.
Labopharm will receive a royalty of 5% on net sales of OLEPTRO™ in the United States in excess of US$10 million in any calendar quarter. Net sales of OLEPTRO™ in the United States for the most recent quarter ended June 30, 2011 were $1.2 million. In addition, Labopharm will receive a royalty of 5% on net sales of OLEPTRO™ in those countries for which it is granting rights to Angelini, including Canada, where OLEPTRO™ has received regulatory approval, and other countries globally, for which Angelini does not already have the commercialization rights. As a result of the restructured agreement, Angelini is now the sole owner of all commercialization rights related to OLEPTRO™ globally.
As part of the completed restructuring of the joint venture, Labopharm has granted to Angelini an exclusive license and rights to develop and commercialize Labopharm's twice-daily acetaminophen product in all European Union countries, Turkey, Georgia and the Commonwealth of Independent States (Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Ukraine, Uzbekistan). Should Angelini develop and commercialize this product, Labopharm will receive a royalty of 5% on net sales of its twice-daily acetaminophen product in the aforementioned countries. Labopharm will also receive milestone payments upon signing of the agreement and the achievement of an agreed-upon sales milestone.
In the event that the agreement for the twice-daily acetaminophen product is terminated, under specific conditions, Labopharm shall have the option to require that Angelini grant back to Labopharm all rights granted under the agreement for, amongst others, the development, use and distribution of twice-daily acetaminophen in consideration for a royalty payment equal to 3.5% of the net sales in the country in which the termination occurs. Termination of the agreement could, amongst others, be triggered by one of the following: (i) Failure by Angelini to meet its Minimum Annual Purchase Quota in any two successive contract years; (ii) Angelini does not begin development activities related to the Development Plan for the product prior to July 31, 2012, or in the event Angelini has not begun any clinical studies related to the product within a pre-determined delay.
About Labopharm Inc.
Labopharm is focused on realizing value from its commercialized products and creating additional value by leveraging its emerging technology platforms to develop increasingly differentiated products. For more information, visit www.labopharm.com.
This press release contains forward-looking statements within the meaning of applicable Canadian Securities legislation, including, statements concerning the restructuring of the joint venture with Gruppo Angelini, statements concerning OLEPTRO™ for the United States, Canada and other countries globally, and statements related to Labopharm's twice-daily acetaminophen product which reflect Labopharm's current expectations regarding future events. These forward-looking statements involve risks and uncertainties, many of which are beyond Labopharm's control. Actual events could differ materially from those projected herein and depend on a number of risks and uncertainties, including risks related to Labopharm's ability to complete partnering transactions and the terms of any such collaboration, if any, risks related to the market acceptance of Labopharm's products and the speed of adoption by clinicians, risks related to intellectual property protection and potential infringement of third-party rights, risks related to research and development of pharmaceutical products and regulatory approvals, and risks associated with intense competition in the pharmaceutical industry generally. For additional disclosure regarding these and other risks faced by Labopharm Inc., see the disclosure contained in its public filings with the Canadian Securities Administrators (CSA), available on the Investor Relations section of Labopharm's website at www.labopharm.com and on the CSA's website at www.sedar.com. Investors are cautioned not to place undue reliance on these forward-looking statements. Unless required by law, Labopharm undertakes no obligation to update or revise the information contained in this press release, whether as a result of new information, future events, or circumstances or otherwise.
OLEPTRO™ is a trademark of Labopharm Inc.
For further information:
At TMX Equicom
Media and Investor Relations
Tel: (416) 815-0700 ext. 257
Tel: (514) 844-7997
Posted: October 2011