Azur Pharma Announces the Acquisition of FazaClo for $42 Million Plus Contingent Milestones
Azur Pharma Limited announced it has signed a definitive agreement with Avanir Pharmaceuticals to acquire worldwide rights to the antipsychotic drug FazaClo(R) (clozapine, USP). The product is indicated for the management of severely ill schizophrenic patients who fail to respond adequately to standard drug treatments for schizophrenia. FazaClo is also indicated for reducing the risk of recurrent suicidal behaviour in patients with schizophrenia or schizoaffective disorders. FazaClo was approved by the FDA, and launched in the U.S. market, in 2004. The transaction is subject to certain closing conditions and is expected to close by the end of July 2007.
Under the terms of the agreement, Azur will pay $42 million to Avanir at the close of the transaction and up to $10 million in contingent payments during 2009. In addition, Azur will pay up to $2 million in future royalties based on 3% of annual net product revenues for FazaClo in excess of $17 million. Azur also assumes certain of Avanir's earn-out obligations to the original developer of the product, Alamo Pharmaceuticals, which arise upon the achievement of sales related milestones.
Azur is acquiring the worldwide rights to FazaClo and assuming the related assets such as marketing, sales, patient registry and medical affairs infrastructure. Azur will add 73 employees with this acquisition, including 65 sales representatives and commercial support staff who market FazaClo in the U.S. and provide field based support to psychiatrists and their patients.
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