Mass. General sells Enbrel rights for $284m
Massachusetts General Hospital today sold its rights to royalties on foreign sales of the rheumatoid arthritis drug Enbrel for $284 million, a move that eliminates its exposure to market risk and will help it build a research endowment.
The sale to Drug Royalty Corporation Inc., a Toronto investment company, follows the settlement of a patent dispute last year between Mass General and Enbrel's manufacturer, Amgen Inc., which yielded $248 million for the hospital. In that settlement, Mass General relinquished rights to royalties on Enbrel sales in the United States.
Mass General chief executive Dr. Peter Slavin said today that the combined $532 million, plus previous sales royalties from Enbrel sales, make the drug the biggest generator of licensing revenue in the hospital's history.
``Lightning occasionally strikes in this area,'' Slavin said.
Worldwide sales of Enbrel in 2006 were $4.4 billion, including $2.9 million in the US. Mass General and Seed could have expected to receive tens of millions of dollars a year in ongoing royalties, but the hospital decided to sell its remaining rights to protect the hospital from market changes that could potentially cut into Enbrel sales, Slavin said.
Enbrel, which has also been approved by the Food and Drug Administration to treat psoriasis, faces competition from Abbott Laboratories' Humira and Centocor Inc.'s Remicade.
``We certainly believe in the product, but there are market forces that you need to consider,'' said Frances Toneguzzo, director of technology licensing at Mass General. ``There's an issue with biologics. They are very expensive, there are reimbursement issues, it is injected. If there is a small molecule that would do the same thing and you could take it orally, that would be the end of Enbrel.''
(By Christopher Rowland, Globe staff)