Astellas acquires European rights for Eligard

Germany's first publicly-traded biotechnology company, MediGene, has sold full European marketing and distribution rights to its hormone-dependent prostate cancer drug, Eligard (leuprolide acetate) to Astellas Pharma Europe. Previously, Astellas was MediGene's European marketing partner for Eligard, having acquired these rights from TOLMAR Therapeutics in 2001.

The agreement states that Astellas will pay MediGene €25m for the Eligard licence over the next six to 12 months, in three tranches as the steps of transfer of the rights are concluded. MediGene will also receive single-digit royalties on future net European product sales.

In return, the biotech will relinquish all future costs, obligations and risks associated with the supply of Eligard to Astellas and all future procurement costs and licence payments to TOLMAR will cease within the next months.

According to Arnd Christ, MediGene's chief financial officer: "This is an excellent deal for MediGene, both in financial and strategic terms. It not only reflects the full net present value of all future Eligard revenues according to the previous deal structure, but also provides us with significant and non-dilutive financing in a very tough capital markets environment.

"Furthermore, the structure of the deal allows MediGene to continue to benefit from the increasing revenue from Eligard, which was not possible under the previous structure. The significant improvement of our balance sheet and the simplification of the Eligard deal structure allow us to fund growth opportunities and thus strengthen the future pipeline of the company."