Collegium Pharmaceutical has entered into a definitive agreement to acquire the U.S. rights to the Nucynta Franchise from Assertio Therapeutics for $375.0 million in cash.
“Acquiring the full U.S. rights to the Nucynta Franchise is financially transformative for Collegium,” said Joe Ciaffoni, President and Chief Executive Officer of Collegium. “We expect the acquisition to improve annual EBITDA and operating cash flows by more than $100 million. The transaction is supported by a financing structure that allows for rapid de-leveraging and enables us to pursue future business development transactions.”
Collegium will make a cash payment to Assertio of $375.0 million, less royalties paid to Assertio in 2020, and subject to certain other adjustments. Collegium will assume the U.S. license for the Nucynta Franchise, and will no longer be required to pay royalties to Assertio. Collegium has secured debt financing commitments of $325.0 million that, together with cash on hand, will be used to fund the purchase price payable to Assertio.
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Collegium will continue to pay Grunenthal GmbH a flat 14% royalty on net sales of the Nucynta Franchise, but will no longer be required to pay a supplemental royalty on sales greater than $180.0 million.
The deal is expected to close on February 14, 2020, subject to satisfaction of customary closing conditions.
The Nucynta Franchise, which includes both an extended-release and an immediate release formulation of tapentadol, is supported by patents with expiries in mid-June 2025, with the potential for a six-month pediatric extension.