Novartis to Pay Up to $507 Million for Hepatitis C Medication Partnership

Swiss-based pharmaceutical giant Novartis AG is partnering with US biotech company Human Genome Sciences Inc. to develop and sell Albuferon, a hepatitis C medication. The agreement, announced yesterday, will see Novartis handle sales outside the US, while Human Genome will focus on the US market. Novartis will share the costs and profits of the medication with Human Genome, and will pay up to $507 million for the partnership.

Key Takeaways:

• Novartis and Human Genome Sciences Inc. have agreed to a partnership to develop and sell Albuferon, a hepatitis C medication.
• The agreement will see Novartis handle sales outside the US, while Human Genome focuses on the US market.
• Novartis will pay up to $507 million for the partnership, and will share the costs and profits with Human Genome.
• Human Genome's shares rose 4% to $10.60 in Nasdaq trading after the announcement.
• Novartis' American depositary receipts fell 1.5% to $55.08 in New York Stock Exchange composite trading.
• Albuferon is currently in the third and final stages of human clinical trials and may be approved by the end of the year.
• Hepatitis C is a liver disease caused by infection with a virus that affects over 170 million patients worldwide.

Statistics:

• $507 million: maximum amount Novartis will pay for the partnership with Human Genome Sciences Inc.
• 41 cents: increase in Human Genome shares on Nasdaq trading after the announcement.
• 4%: rise in Human Genome shares on Nasdaq trading after the announcement.
• 82 cents: fall in Novartis' American depositary receipts on New York Stock Exchange composite trading.
• 1.5%: decline in Novartis American depositary receipts on New York Stock Exchange composite trading.
• 1 year: estimated timeframe for clinical trials to complete and for Albuferon to be approved.

Sources:

• Bloomberg News
• Novartis AG
• Human Genome Sciences Inc.
• Genelabs Technologies Inc.
• Idenix Pharmaceuticals Inc.