Alkermes announced the receipt of a $150 million milestone payment from Biogen triggered by the recent U.S. Food and Drug Administration (FDA) approval of VUMERITY™ (diroximel fumarate), a novel oral fumarate with a distinct chemical structure, for the treatment of relapsing forms of multiple sclerosis, and Alkermes' transfer to Biogen Inc. (Nasdaq: BIIB) of the New Drug Application and other regulatory documentation related to VUMERITY.
"The receipt of this milestone payment marks an important achievement for Alkermes and is a testament to the strategic execution of our clinical and regulatory activities related to VUMERITY over the past few years. This payment bolsters our solid financial foundation and increases our flexibility to pursue strategic business development opportunities and invest in our internal development pipeline," said Blair Jackson, Senior Vice President of Corporate Planning.
Alkermes' financial expectations for 2019, provided on Oct. 23, 2019, reflect this milestone payment. The company will record substantially all of the milestone payment as license revenue in the fourth quarter of 2019. Under the terms of the license and collaboration agreement with Biogen, Alkermes was responsible for conducting the clinical development of VUMERITY and regulatory activities relating to its approval, and Biogen holds the exclusive, worldwide license to commercialize the product. Alkermes is entitled to receive a mid-teens percentage royalty on worldwide net commercial sales of VUMERITY, subject, under certain circumstances, to minimum annual payments for the first five years following FDA approval and customary reductions as set forth in the agreement.
VUMERITY is a novel oral fumarate with a distinct chemical structure approved in the U.S. for the treatment of relapsing forms of multiple sclerosis, to include clinically isolated syndrome, relapsing-remitting disease and active secondary progressive disease. Once in the body, VUMERITY rapidly converts to monomethyl fumarate, the same active metabolite of dimethyl fumarate.