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news.Warner Chilcott will continue to distribute and promote Taclonex, Taclonex Scalp and Dovonex
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LEO Pharma is re-acquiring Warner Chilcott’s exclusive product licensing rights in the US to its topical psoriasis treatments Taclonex, Taclonex Scalp, Dovonex as well as rights to all products in LEO’s development pipeline, and acquiring all inventories of the products, in exchange for a one-time cash payment of $1.0 billion to Warner Chilcott.
Under the terms of the agreement, Warner Chilcott has agreed to continue distribution and promotion of Taclonex, Taclonex Scalp and Dovonex for LEO Pharma until December 31, 2009 and to perform certain transition services for LEO Pharma for up to one year.
Roger Boissonneault, president and chief executive officer of Warner Chilcott, said: “Since 2003, Warner Chilcott has enjoyed a strong partnership with LEO Pharma. This transaction allows Warner Chilcott to concentrate on new strategic initiatives, including the acquisition and integration of the Proctor & Gamble Pharmaceuticals business, and enables LEO Pharma to expand beyond research and development and into the commercialization of products in the United States.”
Gitte Aabo, chief executive officer of LEO Pharma, said: “The acquisition of the psoriasis dermatology portfolio from Warner Chilcott provides LEO with a unique stepping stone and we have incorporated an affiliate to be headquartered in New Jersey. The deal is LEO Pharma’s largest ever and is indicative of our commitment to geographic expansion and growth in areas including the USA. We have valued the collaboration with Warner Chilcott and look forward to establishing LEO as a leading company within the American Dermatology market, armed with one of the strongest pipelines within dermatology. We expect to start operations in the beginning of 2010.”
The repurchase of the product rights and inventories for $1.0 billion will result in a one-time gain for Warner Chilcott of approximately $450m after-tax, or approximately $1.79 per share based on 251.3m shares outstanding. Net cash proceeds, after taxes triggered by the gain, are expected to be approximately $980m.