Bayer settles Onyx spat with $160M payout, sales rights and royalties
Longtime partners Onyx Pharmaceuticals and Bayer have patched up a long-running dispute over who owns the rights to a Phase III cancer drug that bears a close resemblance to the blockbuster Nexavar (sorafenib). An 8-K filed today explains that Bayer will retain control of regorafenib's development and commercialization efforts while Onyx gets a hefty $160 million check and a promise of up to $15 million more, a 20% royalty share on worldwide sales and rights to co-promote the treatment in the U.S.
The dispute involved a good deal of name calling, with Onyx ($ONXX) accusing Bayer HealthCare of secretly developing analogs of Nexavar and filing patents for them without cluing in Onyx. But from the beginning of this dispute back in 2009 Onyx also went to some lengths to emphasize its interest in keeping tempers under control. And both companies expressed their happiness at turning the page, calling for a new chapter in their relationship.
"These new agreements strengthen the collaboration and provide Onyx the opportunity to participate significantly in the market potential of regorafenib," said Onyx CEO Anthony Coles. "Together we are taking our collaboration to the next level by more effectively structuring our future working relationship. Onyx and Bayer are committed to benefitting patients worldwide and ensuring that the potential of both Nexavar and regorafenib is fully realized."
The $160 million check that Onyx gets is in exchange for its royalty rights in Japan.
Regorafenib has demonstrated significant promise. Just a few weeks ago investigators reported efficacy data from a trial involving 48 patients with a common type of kidney cancer. At the beginning of the year investigators for Bayer launched a late-stage study for regorafenib as a treatment for metastatic or unresectable gastrointestinal stromal tumors, a rare stomach cancer. Nexavar earned $934 million in 2010.
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