Royalty Pharma plc (Nasdaq: RPRX) announced today an agreement to acquire the residual royalty interest in Vertex Pharmaceuticals, Inc.’s cystic fibrosis (CF) treatments owned by the Cystic Fibrosis Foundation. The agreement includes an upfront payment of $575 million and a potential milestone payment of $75 million.
As part of previous agreements with the CF Foundation, Royalty Pharma purchased all of the CF Foundation’s royalty interests on Vertex’s CF franchise. Under the terms of those agreements, Royalty Pharma was obligated to pay the CF Foundation 50% of royalties attributable to revenue over $5.8 billion in any calendar year. Today’s agreement eliminates this obligation and entitles Royalty Pharma to all royalties above the previous revenue threshold. The Vertex CF franchise generated net revenues totalling over $4.0 billion in 2019. The royalties under this agreement are perpetual and not tied to patent expirations.
MTS Health Partners and Mintz Levin acted as advisors to the Cystic Fibrosis Foundation on the transaction and Goodwin Procter, Dechert and Maiwald acted as legal advisors to Royalty Pharma.
This text is a press release from Royalty Pharma. The full text version of the article can be found here: https://www.royaltypharma.com/news-releases/news-release-details/royalty-pharma-acquires-additional-royalty-interest-cystic