Orexigen Therapeutics has entered into an agreement with Takeda Pharmaceutical Company Limited to acquire the United States rights to Contrave^® (naltrexone HCl / bupropion HCl extended release), the market leading branded prescription medicine for the treatment of obesity. The acquisition is subject to the parties' receipt of clearance under the Hart-Scott-Rodino Antitrust Improvement Act ("HSR Act"). Upon completion of the acquisition, including the agreed upon transition period, Orexigen will own all rights to Contrave in nearly all global territories.

The acquisition of Contrave by Orexigen is possible as a result of Takeda's realignment of resources behind its recently announced strategic therapeutic areas of focus, and Orexigen's desire to take on more direct responsibility for the Company's flagship product.

Orexigen and Takeda have agreed to a six-month transition period, during which time Takeda is required to continue to commercialize Contrave in the United States with promotional and marketing commitments consistent with the July 2015 Collaboration Agreement. During the transition period, Orexigen is entitled to continue to earn royalties on net Contrave sales and the two parties will share clinical development costs according to the July 2015 Collaboration Agreement. At the conclusion of the transition services period, Orexigen is entitled to 100% of net sales and be responsible for all expenses.

To fund commercialization of Contrave in the United States, Orexigen has sold $165 million in convertible senior secured notes in a private placement to an investor syndicate led by funds managed by The Baupost Group, L.L.C. In a separate announcement today, the company also announced a commercial and distribution agreement with Valeant for 19 Central and Eastern European countries.

"The announcements made today are transformational for Orexigen. The acquisition of all U.S. rights to Contrave greatly increases our projected long-term profitability and opens multiple new paths for shareholder value creation," said Mike Narachi, CEO of Orexigen. "The Mysimba® commercialization agreement with Valeant for Central and Eastern Europe and Turkey marks solid progress in our strategy to establish strong partnerships for ex-U.S. commercialization of Contrave/Mysimba. Valeant expects to begin selling product in Europe in the second half of 2016."

Narachi continued: "With the U.S. Contrave acquisition and the related financing, Orexigen will have the control and the capital strength to implement a focused, creative U.S. commercialization plan designed to achieve near-term profitability while still building and retaining value for the longer-term potential of Contrave / Mysimba."

Orexigen's Chief Commercial Officer, Dr. Thomas Cannell, added: "The acquisition is occurring at a particularly advantageous moment in the product's lifecycle, following the successful initial and heavily resourced commercial launch by Takeda which firmly established Contrave's market lead as the most prescribed weight loss drug among branded alternatives."

Orexigen believes the valuable product performance and market data gathered during the Contrave launch will allow a targeted, data-driven commercial plan to drive the next phase of Contrave's growth.

"Over the next three years, we have the potential to achieve our sales and profitability targets through execution on three key strategies: launching an effective and efficient U.S. commercial organization;  achieving strong growth of Contrave by differentiating it from generic amphetamines; and improving the gross to net discount through managed care and pharmacy discount strategies," Cannell added.

Orexigen intends to share more details of its post-transition period commercialization plan in coming months.