Date: 2014-01-17
Type of information: Product acquisition
Compound: Dermagraft® assets
Company: Shire (UK-USA) Organogenesis (USA)
Therapeutic area: Metabolic diseases
Type agreement: product acquisition
Action mechanism: Dermagraft® is a living skin substitute indicated for use in the treatment of full-thickness diabetic foot ulcers.
Disease: diabetic foot ulcers
Details: * On January 17, 2014, Shire has announced that it has entered into a definitive agreement pursuant to which it has sold its Dermagraft® assets to Organogenesis. The Dermagraft® assets that have been sold comprise the key operating assets relating to the development, manufacture and sale of the Dermagraft® product. These assets include intellectual property relating to Dermagraft® including patents, trademarks and know-how; regulatory filings and registrations relating to Dermagraft®; certain manufacturing plant, equipment and materials; Dermagraft® product inventory and accounts receivable. These assets had a value of $683 million in Shire’s September 30, 2013 balance sheet. Shire is generally retaining legacy liabilities relating to the Dermagraft® business, including the previously announced Department of Justice investigation relating to the sales and marketing practices of Advanced Biohealing, Inc (now known as Shire Regenerative Medicine, Inc.).
Financial terms: Shire will receive no upfront payment from Organogenesis but is entitled to receive up to $300 million cash in total milestone payments should Organogenesis meet certain annual net sales targets between now and 2018(1). Shire will record a loss on disposal and associated impairment charges of approximately $650 million in the fourth quarter of 2013, which will be excluded from Non GAAP earnings.
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