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Jazz Pharmaceuticals jumps as it agrees patent settlement with Hikma on narcolepsy treatment

Thursday, April 6, 2017 6:17
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Nasdaq–listed, Dublin-based biopharmaceuticals firm Jazz Pharmaceuticals PLC (NASDAQ:JAZZ) saw its shares jump by over 6% in pre-market trading today after it agreed a settlement with London-listed  Hikma Pharmaceuticals PLC (LON:HIK) which resolves a patent litigation with regards to Jazz’s narcolepsy treatment, Xyrem.

Under the settlement, Jazz will grant Hikma and its wholly-owned subsidiary West-Ward Pharmaceuticals Corp the right to sell an authorised generic version of Xyrem in the US from the beginning of January 2023.

Hikma will pay a royalty on net sales of the excessive sleepiness treatment, but will initially retail a “meaningful percentage” of net sales, the UK firm said in a statement.

The FTSE 100-listed group will also pay for the supply of the generic drug, and reimburse Jazz with a portion of the service costs.

Sales of Xyrem were reported at around US$D1.11bn in 2016, according to Jazz’s annual report.

The initial term of the agreement is six months, and Hikma will have the option to extend this term for a total of five years.

Jazz has also agreed to grant Hikma a licence to market generic sodium oxybate, the active ingredient in Xyrem at the end of the term.

In pre-market trading in New York, Jazz shares were 6.1% higher at US$149.20, while in London, Hikma shares were 16p lower at 1,916p.

Story by ProactiveInvestors


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