BioMarin Purchases Huxley

Recently, BioMarin Pharmaceutical Inc. (BMRN - Analyst Report) announced that it has acquired the privately held Huxley Pharmaceuticals Inc., which possessed rights to a proprietary form of 3,4-diaminopyridine amifampridine phosphate ( 3,4-DAP), for the treatment of Lambert Eaton Myasthenic Syndrome (LEMS).
 
Under the terms of the transaction, BioMarin has already made an upfront payment of $15 million to Huxley shareholders and will pay an additional $7.5 million upon the final approval of amifampridine for LEMS from the European Commission (EC). The EC is expected to grant its approval in late 2009 or early 2010. Furthermore, Huxley stockholders would receive up to approximately $36 million in milestone payments if certain sales and U.S. development milestones are met.
 
BioMarin intends to launch amifampridine phosphate in Europe in the first quarter and is looking to develop an appropriate strategy for the drug in the U.S. Amifampridine phosphate will be the first drug to be approved for the treatment of LEMS if and when the EC clears the drug. Consequently, it would enjoy an orphan drug status and 10 years of market exclusivity in Europe. The drug has the potential to be used for other indications − including multiple sclerosis (MS) − in the US and Europe.
 
As a reminder, Huxley Pharmaceuticals licensed the rights to this form of amifampridine phosphate from EUSA Pharma. EUSA had in turn acquired the right from the original developer, Assistance Publique Hopitaux de Paris.
 
If BioMarin is able to successfully develop the drug for MS, it would make an unspecified milestone payment to EUSA as well. However, it will face tough competition from big players such as Biogen Idec (BIIB - Analyst Report), Pfizer (PFE - Analyst Report) and Teva Pharmaceutical Industries (TEVA - Snapshot Report) in the MS market.
 
LEMS, a rare autoimmune disease, affects 1,200 to 3,100 people in the US and 2,000 to 5,000 in Europe. Muscle weakness, mainly in the legs and trunk is its main symptom. Approximately half of the diagnosed LEMS patients are affected by small cell lung cancer. LEMS results in other problems as well such as reduced reflexes, drooping of the eyelids, facial weakness and problems in swallowing.
 
Currently, we are Neutral on BioMarin.