Ligand (LGND) Unit Enters $3M Captisol Supply Agreement with Hospira (HSP)
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On December 22, 2011, CyDex Pharmaceuticals, Inc., a wholly owned subsidiary of Ligand Pharmaceuticals Incorporated (Nasdaq: LGND), entered into a License and Supply Agreement with Hospira, Inc. (NYSE: HSP).
Under the Agreement, the Company granted a license in the specified territories, with sub-license rights, to such intellectual property rights that will enable the manufacture and sale of certain finished drug products of which Captisol is a component. The terms of the Agreement call for the Company to receive a non-refundable license fee of $500,000.
In addition, the Company will receive a pre-payment of $2,500,000, to be applied as a credit toward the first $2,500,000 of Captisol supplied under the Agreement. In the event of a termination prior to the Company supplying $2,500,000 of Captisol, the Company will refund the difference of the value of Captisol supplied and the $2,500,000 pre-payment. The Company is also eligible to receive milestone payments upon the occurrence of certain specified sales goals.
Under the Agreement, Hospira has agreed to order 90%, and the Company has agreed to supply Captisol required for the formulation and sale of the products contemplated by the Agreement.
The Agreement will continue in effect until the eighth anniversary of the first commercial sale of the finished drug product in the United States. Following such anniversary, the Agreement will automatically renew for successive one year periods unless Hospira provides prior notice of nonrenewal. The Agreement may be terminated by the Company for the uncured material breach of Hospira. Hospira may terminate the Agreement at any time on prior notice.
Captisol is a patent protected, chemically modified cyclodextrin with a structure designed to optimize the solubility and stability of drugs.
Under the Agreement, the Company granted a license in the specified territories, with sub-license rights, to such intellectual property rights that will enable the manufacture and sale of certain finished drug products of which Captisol is a component. The terms of the Agreement call for the Company to receive a non-refundable license fee of $500,000.
In addition, the Company will receive a pre-payment of $2,500,000, to be applied as a credit toward the first $2,500,000 of Captisol supplied under the Agreement. In the event of a termination prior to the Company supplying $2,500,000 of Captisol, the Company will refund the difference of the value of Captisol supplied and the $2,500,000 pre-payment. The Company is also eligible to receive milestone payments upon the occurrence of certain specified sales goals.
Under the Agreement, Hospira has agreed to order 90%, and the Company has agreed to supply Captisol required for the formulation and sale of the products contemplated by the Agreement.
The Agreement will continue in effect until the eighth anniversary of the first commercial sale of the finished drug product in the United States. Following such anniversary, the Agreement will automatically renew for successive one year periods unless Hospira provides prior notice of nonrenewal. The Agreement may be terminated by the Company for the uncured material breach of Hospira. Hospira may terminate the Agreement at any time on prior notice.
Captisol is a patent protected, chemically modified cyclodextrin with a structure designed to optimize the solubility and stability of drugs.
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