November 22, 2013

Vertex sells overseas rights to drug

By Chris Reidy  |  GLOBE STAFF  NOVEMBER 21, 2013

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VERTEX PHARMACEUTICALS INC.

Telaprevir sales have declined faster than Cambridge-based Vertex anticipated. A second-generation hepatitis C drug is in the works.

With it sights set on solving a different illness, Vertex Pharmaceuticals Inc., is selling off royalty rights to the sale of its hepatitis C treatment in overseas markets to the Belgian drug company Janssen Pharmaceutica NV for $152 million.

The royalty exchange is another sign of how fast Vertex is moving on from the drug, telaprevir, after sales of the treatment plummeted in the face of new competition.

While Vertex has a second-generation hepatitis C drug in the works, its new focus is developing a treatment for cystic fibrosis.

The money from Janssen will be used to advance its work on drugs for cystic fibrosis and other conditions, Vertex said in a statement.

Last month, the Cambridge biotech said it would cut 17 percent of its workforce, including 175 jobs in Massachusetts, and return $4.4 million in state tax incentives it had received for promising to create jobs, partly because of an unexpected drop in the sales of telaprevir.

Vertex is preparing to relocate from Cambridge to a gleaming new $800 million headquarters on the South Boston Waterfront, for which it received government tax subsidies.

Telaprevir is marketed under two brand names: as Incivek in North America and as Incivo in Europe and other markets. The deal with Janssen involves only the rights for Incivo. Vertex will continue to sell Incivek in North America.

Janssen will make a single $152 million cash payment to Vertex in the fourth quarter of 2013.

Under a 2006 collaboration, Janssen agreed to develop and commercialize the hepatitis C drug in Europe and elsewhere and to pay Vertex royalties on sales of the drug in those regions.

The Vertex drug has treated over 100,000 patients worldwide and generated more than $2 billion in sales since it was introduced in May 2011.

But in recent months, sales have been falling much faster than the company had anticipated, because doctors are encouraging patients to wait for a new generation of treatments that work better and are easier to take.

Chris Reidy can be reached at reidy@globe.com.

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