Vertex Pharmaceuticals (NASDAQ:[[ticker:VRTX]]) is making its second move this month to raise non-dilutive cash from its previous agreements to commercialize its experimental hepatitis C drug telaprevir. The Cambridge, MA-based firm said this morning that it will receive an upfront sum of $105 million from Mitsubishi Tanabe Pharma in an amended deal between the two companies to commercialize the potential blockbuster drug in Asia.
Mitsubishi, one of the largest pharma outfits in Japan, is paying Vertex for rights to sell and manufacture telaprevir for treating HCV infections in combination with the existing drugs interferon and ribavirin in Japan and the Far East. Vertex is also eligible for between $15 million and $65 million in milestone payments—in lieu of royalties—for the approval and commercial launch of telaprevir in Japan, according to Vertex. This amends the two companies’ 2004 deal, in which Mitsubishi gained certain rights to telaprevir in Asia as a standalone HCV therapy.
The new agreement gives Vertex an immediate cash infusion as the firm moves telaprevir, a protease inhibitor drug, through expensive, late-stage clinical trials in the U.S., Europe, and Japan. Earlier this month, Vertex announced an interesting fund-raising plan to sell rights to receive $250 million in payments that the company is eligible to garner for the successful approval and launch of telaprevir in Europe from the Janssen Pharmaceutica unit of health products giant Johnson & Johnson (NYSE:[[ticker:JNJ]]). (Yes, that’s the rights to receive the payments, not the commercial rights themselves, which Janssen would still control if the payment rights were sold to another party.) Vertex still has exclusive commercial rights to telaprevir in North America, where analysts expect the drug to become a multibillion-dollar product if it is approved.
“The cash received [in this amended deal with Mitsubishi] strengthens our corporate financial position during an important period of investment and growth as we advance two Phase III programs in hepatitis C and cystic fibrosis,” said Kurt Graves, chief commercial officer of Vertex, in a prepared statement.
Telaprevir is an oral drug that is designed to attack an enzyme important to viral replication in HCV, a chronic liver disease that affects an estimated 170 million people worldwide, according to Vertex.
