Biogen Expects to Receive One-time Payment and Continuing Royalties
Biogen, Inc. (NASDAQ: BGEN) announced today that it has settled its arbitrations with Schering-Plough Corporation over royalties on U.S. sales of alpha interferon products.
As part of the settlement, Biogen expects to receive in the fourth quarter of 2002 a one-time payment in the range of $45 – $50 million, which represents a portion of the amount that was in dispute between the parties. The actual amount of the payment is subject to final calculation and review by the parties. In addition, Schering-Plough has agreed, effective October 1, 2002, to commence royalty payments to Biogen on United States sales of alpha interferon products based on a 1998 agreement between the two companies.
Thomas J. Bucknum, Biogen´s Executive Vice President, General Counsel stated, “We are very pleased to have reached a settlement in this matter. We look forward to moving beyond this dispute in our relationship with Schering-Plough.”
Biogen had granted an exclusive worldwide license to Schering-Plough under Biogen´s alpha interferon patents. Schering-Plough sells its INTRON A (interferon alfa-2b) brand of alpha interferon in various countries, including the United States, for a number of indications. Schering-Plough also sells alpha interferon in other forms for the treatment of hepatitis C, including REBETRON Combination Therapy containing INTRON A and REBETOL (ribavirin, USP) and PEG-INTRON (peginterferon alfa-2b), a pegylated form of alpha interferon.
In 2001, Schering-Plough discontinued payment to Biogen of royalties on U.S. sales based on a U.S. Court of Appeals´ decision interpreting the scope of Biogen´s alpha interferon patent more narrowly than Biogen and Schering-Plough believed appropriate. Biogen disagreed with Schering-Plough´s decision to discontinue payment and filed for arbitration to compel payment of unpaid past royalties and to ensure payment of future royalties under the license agreement.
This press release contains forward-looking statements regarding the range of the expected settlement payment from Schering-Plough. These statements are based on the Company´s current beliefs and expectations. The actual amount of the settlement payment is subject to final calculation and certification by Schering-Plough and review by Biogen and, as a result, could vary from the expected amount. The Company does not undertake any obligation to publicly update any forward-looking statements.
Biogen, Inc., winner of the U.S. National Medal of Technology, is a biotechnology company principally engaged in discovering and developing drugs for human healthcare through genetic engineering. Headquartered in Cambridge, MA, the Company´s revenues are generated from worldwide sales of AVONEX® (interferon beta-1a) for treatment of relapsing forms of multiple sclerosis, (Please see full prescribing information at http://www.avonex.com.), and from the worldwide sales by licensees of a number of products. Biogen´s research and development activities are focused on novel products to treat inflammatory and autoimmune diseases, neurological diseases, cancer, fibrosis and congestive heart failure. The Company maintains active clinical research programs in protein therapeutics, small molecules, genomics and gene therapy. For copies of press releases and additional information about the Company, please consult Biogen´s homepage on the World Wide Web at http://www.biogen.com.