QLT Restructures Visudyne Agreement With Novartis

QLT has restructured its agreement with Novartis to simplify the relationship, under which, effective January 1, 2010, it will, among other things, receive exclusive US rights to the Visudyne patents to sell and market Visudyne in the US.

Reportedly, under the amended and restated PDT product development, manufacturing and distribution agreement (the Amended PDT Agreement), QLT will have exclusive US sales and marketing rights to Visudyne, including rights to all end-user revenue derived from Visudyne sales in the US. Novartis will have marketing and sales rights in all countries outside of the US (ex-US) and will pay QLT a royalty of 20% of ex-US net sales until December 31, 2014, and thereafter 16% of ex-US net sales until the expiry of the Amended PDT Agreement on December 31, 2019.

The company has said that QLT will continue to manufacture Visudyne and will supply the product at a pre-specified price exclusively to Novartis for ex-US distribution. QLT and Novartis will each be responsible for all costs and expenses associated with marketing and sales in their respective territories.

Moreover, as part of the restructuring, QLT and Novartis have released each other from all open claims the parties may have against each other, including any in connection with QLT’s litigation with Massachusetts Eye and Ear Infirmary and QLT’s litigation with General Hospital Corporation.

Bob Butchofsky, president and CEO of QLT, said: “We are very pleased with the amended terms of our agreement with Novartis which we expect will increase our revenue from Visudyne and will simplify our relationship. This restructure will allow us to directly influence Visudyne sales in the US by a small focused sales force centered on retinal specialists.”