November 19, 2014
By Krystle Vermes, BioSpace.com Breaking News Staff
Royalty Pharma, a company dedicated to acquiring royalty interests in marketed and late stage biopharmaceutical products, announced today that it has acquired royalties on Vertex Pharmaceuticals ’ cystic fibrosis treatments for $3.3 billion. Cystic Fibrosis Foundation Therapeutics, an affiliate of the Cystic Fibrosis foundation, owns the treatments.
“We are honored to work with the Cystic Fibrosis Foundation on this extraordinary royalty transaction,” said Pablo Legorreta, Royalty Pharma‘s founder and chief executive officer. “Our goal is to be the premier provider of innovative capital to enable the life sciences industry to accelerate development of important novel therapies. Furthermore, this transaction represents an important validation of the foundation’s bold vision under Dr. Beall‘s leadership to fund new drug development as part of its successful venture philanthropy model. These therapies are notable examples of fundamental research leading to breakthrough treatments that dramatically improve patient’s lives.”
Bank of America Merrill Lynch acted as the financial advisors to Royal Pharma during this transaction. The company financed this acquisition with cash on hand and a $2.7 billion unsecured term loan.
“This is a transformational moment for people with cystic fibrosis and the entire CF community,” said Robert Beall, president and chief executive officer of the Cystic Fibrosis Foundation. “These new funds give us a tremendous opportunity to supercharge our efforts to develop lifesaving new therapies, ensure that the best possible care and resources are available for people with CF, and pursue daring, new opportunities that one day may lead to a permanent, lifelong cure for this disease.”
Cystic fibrosis affects 70,000 children and adults in the world. It is a fatal genetic disease that affects the digestive system and the lungs. In 1989, CFF-sponsored scientists were able to identify the cystic fibrosis transmembrane conductance regulator responsible for the disease. As a result, new products were developed to treat the underlying causes of the condition.
Royalty Pharma has assets totaling around $12 billion. It owns royalty interests in more than 40 products including Humira, Remicade, Tradjenta and Lyrica. The company also funds late stage clinical trials in exchange for royalty interests. It has been working with biopharmaceutical and biotechnology companies since 1996.
