Ligand Pharmaceuticals has agreed to sell the intellectual property rights associated with thrombocytopenia drug Promacta (eltrombopag) to Royalty Pharma for a cash consideration of $827m.
Previously, Ligand licensed Promacta-related intellectual property rights to Novartis. The latest deal additionally covers the royalty stream on global net sales of the drug.
Promacta, called Revolade outside the US, is marketed worldwide by Novartis.
It has approval in more than 90 countries to treat thrombocytopenia – a bleeding disorder characterized by abnormally low levels of thrombocytes in the blood – in adults with chronic immune thrombocytopenic purpura (ITP) and inadequate response or intolerance to other therapies.
ITP can lead to bleeding tendency, cause patients to bruise easily and see extravasation of blood from capillaries into skin and mucous membranes.
The drug is also indicated for severe aplastic anaemia (SAA), a disease in which the bone marrow does not make enough blood cells for the body, as well as thrombocytopenia in chronic hepatitis C patients.
Introduced in 2008, Promacta fetched royalties of $291m for Ligand over the last 11 years. The company noted that the drug’s sales rose at a compound annual growth rate of 32% over the past five years.
The drug’s global patents are set to expire between 2021 and 2028.
Ligand intends to leverage the sale of Promacta to invest into other assets and drive financial growth.
Ligand Pharmaceuticals CEO John Higgins said: “The product has been a big part of our success, driving the company to profitability and generating significant cash flows through the years.
“In addition to receiving an attractive and substantial valuation for the future royalties, this transaction allows Ligand to focus investment of the cash proceeds into assets and companies that will drive financial growth five, ten years and beyond.”
The company intends to use the proceeds from the transaction to acquire assets that can generate long-term revenue and for share repurchases to boost per share profits and cash-flow.