Lundbeck amends the Selincro licensing agreement ex Europe and the US and makes EUR 10 million equity investment in Biotie

• Lundbeck acquires an equity stake (<5%) in Finnish Biotie
• Selincro^TM is the first medicine aimed for the reduction of alcohol consumption in patients with alcohol dependence and it is currently undergoing regulatory review in Europe
• Patients with alcohol dependence are currently both underdiagnosed and undertreated indicating a need for new treatment approaches
• Alcohol dependence is one of the most burdensome diseases ranked as number 9  according to WHO

H. Lundbeck A/S (Lundbeck) today announced the investment of EUR 10 million in Biotie Therapies Corp. (Biotie) in Finland. Lundbeck has subscribed for 18,604,651 shares in Biotie at a subscription price of EUR 0.5375 per share representing less than 5% of the total equity capital in Biotie.

In connection with this transaction, to facilitate the potential launch of Selincro (nalmefene) outside of Europe, the royalty rates on Selincro in countries outside Europe and the US have been reduced. However, Biotie is to receive an additional sales milestone following the achievement of an undisclosed sales target in Japan, increasing the total milestone package to EUR 89 million from previously EUR 84 million.

Lundbeck holds worldwide development and commercialisation rights to Selincro, a novel opioid system modulator for the treatment of alcohol dependence. Lundbeck has filed a marketing authorization application for Selincro in the EU with European Medicines Agency (EMA) and a decision on potential approval is expected in the fourth quarter of 2012. 

“We are now at a stage where we can start the discussions around the development strategy outside Europe and we are therefore pleased that we can amend the licensing agreement and further strengthen our commitment to Biotie. " says Executive Vice President Anders Gersel Pedersen, Head of Research & Development at Lundbeck, and continues: "Moreover, the equity investment in Biotie, which we have worked with since 2006, underlines our commitment to this project, but also to our ambition to making successful alliances with leading biotech companies"

The transaction was executed on 6 September, 2012, after the close of trading on the Finnish Stock Market. The transaction was priced at a 25% premium to closing price as of 6 September, EUR 0.5375 per share. The new shares will be listed on the NASDAQ OMX Helsinki Exchange. The new shares carry all shareholder rights once the new shares have been registered with the Finnish Trade Register.

In connection with the share subscription, Lundbeck has agreed not to sell or otherwise dispose the new shares during 18 months after the subscription without prior consent of Biotie.

Financial guidance
The content of this release will have no influence on the Lundbeck Group's financial guidance for 2012, which was provided on 8 February 2012 in connection with the release of the financial results for 2011, and further specified in connection with the announcement of the restructuring plan on 14 June 2012.

About Selincro™ (nalmefene)
Selincro is an opioid system modulator with a distinct mu (µ), delta (δ), and kappa (κ) profile. With its modulating effect on the cortico-mesolimbic system, Selincro is thought to reduce the reinforcing effects of alcohol, helping the patient to reduce drinking.

Lundbeck licensed the rights to Selincro from Biotie in Finland. Under the terms of the agreement, Biotie received an execution fee of EUR 12 million. In total, Biotie is eligible for up to EUR 89 million in upfront and milestone payments plus royalty on sales. Lundbeck will be responsible for manufacturing and registration of the product.

Lundbeck holds the global rights to the compound.

Lundbeck has submitted a marketing authorisation application for Selincro for the treatment of alcohol dependence via the centralised procedure for regulatory approval in Europe in December 2011.

About alcohol dependence
Alcohol dependence is comparable to other chronic diseases such as diabetes, asthma and hypertension in terms of vulnerability, onset and course.[i] In Europe more than 15 million people suffer from alcohol dependence in any one year.[ii] Alcohol consumption is the second-highest risk factor for ill-health in Europe, after tobacco, and is strongly correlated with the risk of short-and long-term morbidity and mortality.[iii]^,[iv],[v]

The standard treatment for alcohol dependence consists of psychosocial therapy or pharmacological intervention in combination with psychosocial therapy to achieve and maintain abstinence,[vi] but the abstinence approach shows relapse rates as high as 80%.[vii]^,[viii] High failure rates have led to research into an alternative, reduction based approach. Reduction of alcohol consumption is associated with rapid improvements in short-term health status and reduced risk of long-term illness and reduction of alcohol consumption decreases the risk of morbidity and mortality in patients with alcohol dependence.^3,[ix],[x]
 

Lundbeck contacts

About Lundbeck
H. Lundbeck A/S (LUN.CO, LUN DC, HLUYY) is an international pharmaceutical company highly committed to improving the quality of life for people suffering from brain disorders. For this purpose, Lundbeck is engaged in the research, development, production, marketing and sale of pharmaceuticals across the world. The company’s products are targeted at disorders such as depression and anxiety, psychotic disorders, epilepsy and Huntington’s, Alzheimer’s and Parkinson’s diseases.

Lundbeck was founded in 1915 by Hans Lundbeck in Copenhagen, Denmark. Today Lundbeck employs approximately 6,000 people worldwide. Lundbeck is one of the world’s leading pharmaceutical companies working with brain disorders. In 2011, the company's revenue was DKK 16.0 billion (approximately EUR 2.1 billion or USD 3.0 billion). For more information, please visit www.lundbeck.com.

Safe Harbor/Forward-Looking Statements
The above information contains forward-looking statements that provide our expectations or forecasts of future events such as new product introductions, product approvals and financial performance.

Such forward-looking statements are subject to risks, uncertainties and inaccurate assumptions. This may cause actual results to differ materially from expectations and it may cause any or all of our forward-looking statements here or in other publications to be wrong. Factors that may affect future results include interest rate and currency exchange rate fluctuations, delay or failure of development projects, production problems, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Lundbeck's products, introduction of competing products, Lundbeck's ability to successfully market both new and existing products, exposure to product liability and other lawsuits, changes in reimbursement rules and governmental laws and related interpretation thereof, and unexpected growth in costs and expenses.

Certain assumptions made by Lundbeck are required by Danish Securities Law for full disclosure of material corporate information. Some assumptions, including assumptions relating to sales associated with product that is prescribed for unapproved uses, are made taking into account past performances of other similar drugs for similar disease states or past performance of the same drug in other regions where the product is currently marketed. It is important to note that although physicians may, as part of their freedom to practice medicine in the US, prescribe approved drugs for any use they deem appropriate, including unapproved uses, at Lundbeck, promotion of unapproved uses is strictly prohibited.

[i] McLellan AT, Lewis DC, O'Brien CP, Kleber HD.  Drug dependence, a chronic medical illness: implications for treatment, insurance, and outcomes evaluation.  JAMA 2000; 284: 1689-1695.

[ii] Wittchen HU et al. The size and burden of mental disorders and other disorders of the brain in Europe 2010.  Eur Neuropsychopharmacol 2011; 21: 655-679.

[iii] Rehm J, Zatonksi W, Taylor B, Anderson P.  Epidemiology and alcohol policy in Europe.  Addiction 2011; 106 (Suppl 1): 11-19.

[iv] World Health Organization.  Global Status Report on Alcohol and Health.  Available at: http://www.who.int/substance_abuse/publications/global_alcohol_report/msbgsruprofiles.pdf.  [Last update 2011b] Accessed January 2012.

[v] Alati R et al. Is there really a 'J-shaped' curve in the association between alcohol consumption and symptoms of depression and anxiety?  Findings from the Mater-University Study of Pregnancy and its outcomes.  Addiction 2005; 100: 643-651.

[vi] Gastfriend, DR et al. Reduction in heavy drinking as a treatment outcome in alcohol dependence. Journal of Substance Abuse Treatment 2007;33:71– 80.

[vii] Moos RH, Moos BS.  Rates and predictors of relapse after natural and treated remission from alcohol use disorders.  Addiction 2006; 101: 212-222.

[viii] Miller WR, Walters ST, Bennett ME. How effective is alcoholism treatment in the United States? J Stud Alcohol 2001; 62: 211-220.

[ix] Anderson P, Baumberg B.  Alcohol in Europe.  A public health perspective.  A report for the European Commission.  Available at: http://ec.europa.eu/health/archive/ph_determinants/life_style/alcohol/documents/alcohol_europe_en.pdf.  Accessed: January 2012.

[x] Xin X, He J, Frontini MG, Ogden LG, Motsamai OI, Whelton PK.  Effects of alcohol reduction on blood pressure: a meta-analysis of randomized controlled trials.  Hypertension 2001; 38: 1112-1117.