Royalty Pharma Buys Cystic Fibrosis Drug Royalties For $3.3 Bln

(RTTNews) - Royalty Pharma Wednesday said it has acquired royalties on Vertex Pharmaceuticals Inc.'s (VRTX) cystic fibrosis treatments owned by Cystic Fibrosis Foundation for $3.3 billion.

The acquisition was funded with a combination of cash on hand and a $2.7 billion unsecured term loan provided by Bank of America Merrill Lynch.

Royalty Pharma's Chief Executive Pablo Legorreta said, "Our goal is to be the premier provider of innovative capital to enable the life sciences industry to accelerate development of important novel therapies."

Royalty Pharma acquires royalty interests in marketed and late stage biopharmaceutical products, and has total assets of over $12 billion. Royalty Pharma owns royalty interests in 40 products including Humira, Remicade, Atripla, and Truvada. The company also also funds late-stage clinical trials in exchange for royalty interests.

Cystic fibrosis is a rare genetic disease for which there is no cure. It affects the lungs, pancreas, liver and intestines. An estimated 70,000 children and adults worldwide have cystic fibrosis.

Vertex's cystic fibrosis drug, Kalydeco or Ivacaftor, was developed in association with Cystic Fibrosis Foundation. It was approved by the U.S. FDA in January 2012 and is one of the most expensive drugs.

Cystic fibrosis Foundation Chief Executive Robert BeallOfficer said, "These new funds give us a tremendous opportunity to supercharge our efforts to develop lifesaving new therapies, ensure that the best possible care and resources are available for people with CF, and pursue daring, new opportunities that one day may lead to a permanent, lifelong cure for this disease."

VRTX is currently trading at $115.00, up $3.96 or 3.57%, on the Nasdaq.