Arena and Eisai Expand Marketing and Supply Agreement
News Nov 19, 2013
Arena Pharmaceuticals, Inc. and Eisai Inc. have announced the expansion of the BELVIQ® (lorcaserin HCl) marketing and supply agreement between Arena Pharmaceuticals, Inc.'s wholly owned subsidiary, Arena Pharmaceuticals GmbH, and Eisai Inc. along with its parent company Eisai Co., Ltd.
The expanded agreement provides Eisai with exclusive commercialization rights for all countries worldwide, except for South Korea, Taiwan, Australia, Israel and New Zealand.
This agreement amends and restates the previous agreement that granted Eisai rights to commercialize BELVIQ in most of North and South America. Eisai's commercialization rights are subject to applicable regulatory approval.
"This new agreement not only expands Eisai's territory for commercialization, but it also prioritizes our global development program for BELVIQ," said Jack Lief, Arena's President and Chief Executive Officer. "Expanding our collaboration with Eisai provides the potential to make BELVIQ available to physicians and patients worldwide for weight management and creates a powerful platform to investigate this novel compound for possible new indications by leveraging our combined drug development and regulatory expertise."
Lonnel Coats, Eisai Inc.'s President and Chief Executive Officer, added, "Our expanded commitment to BELVIQ reflects the company's human health care mission to bring new, innovative therapies to patients. Our belief in this product is strengthened by the feedback we have received from patients, physicians and payers since the US launch of BELVIQ. We have a strong foundation on which Eisai and Arena can build a global franchise for BELVIQ."
Under the terms of the agreement, Arena will receive from Eisai an upfront payment of $60 million and is eligible to receive up to a total of $176.5 million in regulatory and development milestone payments.
The total for milestone payments represents an increase of $123 million from the amount remaining available under the previous agreement.
Arena will continue to sell BELVIQ to Eisai for commercialization in the US and in the other territories in North and South America for a purchase price starting at 31.5% and 30.75% of Eisai's net sales, respectively.
With respect to the new territories added under the amended agreement, the purchase price starts at 27.5% of Eisai's net sales in Europe, China and Japan, and at 30.75% of Eisai's net sales in all other territories.
The purchase price will increase on a tiered basis in the US and the other territories, other than Europe, China and Japan, to as high as 36.5% and 35.75%, respectively, on the portion of Eisai's annual net sales exceeding $750 million.
The purchase price will increase to 35% in Europe, China and Japan on the portion of Eisai's annual net sales exceeding $500 million.
Arena is also eligible to receive a total of $1.56 billion in one-time purchase price adjustment payments based on sales in the territories covered by the agreement. The total for purchase price adjustment payments represents an increase of $185 million from the amount available under the previous agreement.
In addition to pursuing regulatory approval for weight management in the expanded territory, under the terms of the agreement, Eisai and Arena plan to investigate the potential of BELVIQ in new areas, such as smoking cessation, a once-daily formulation, a fixed-dose combination with phentermine, as well as explore BELVIQ's impact on diabetes and cardiovascular outcomes.