Lundbeck expands the agreement with Teva to include marketing of Azilect® in selected Asian countries
H. Lundbeck A/S (Lundbeck) today announced it had expanded the agreement with
Teva Pharmaceutical Industries Ltd. (NASDAQ:TEVA) for Azilect(®) to cover six
markets in Asia - China, South Korea, Hong Kong, Malaysia, Thailand and the
The Asian market is becoming an increasingly important platform for Lundbeck, as
the region experiences rapid growth within the CNS market. With the agreement
Lundbeck gains access to six interesting Asian markets all expected to show
significant growth within the Parkinson's disease market. Azilect(®) will be a
significant growth driver of Lundbeck's Asian business in general, and
especially for China and South Korea. The agreement comes on top of the recent
grant of reimbursement in China on two of Lundbeck's key products, Cipralex(®)
As part of the agreement Lundbeck is responsible for conducting the clinical
trials and preparing the application filings needed to gain a marketing
authorisation in the individual markets. The first launch in one of the markets
may potentially occur in approximately one year.
"With the new agreement with our partner Teva, we get an opportunity to expand
our already successful work with Azilect(®). The pharmaceutical markets in Asia,
and the CNS market in particular, is undergoing rapid development, and we see
this agreement as a possibility to further strengthen our commercial platform in
this promising region," says Ole Chrintz, Senior Vice President, Commercial
Operations at Lundbeck. "Azilect(®) is an important treatment option in an
unsatisfied Parkinson's disease market and is the first medication that in
clinical trials has shown an effect consistent with the possibility of disease
modification in Parkinson's disease. We are glad that we will now be able to
offer this effective treatment to the population in the Asian countries."
Specific financial terms remain undisclosed but Lundbeck will pay a share of net
sales in the markets to Teva.
Change in accounting policy
In connection with the conclusion of the agreement and as a result of the
clarification made in 2009 to IAS 18 Revenue in respect of the agent and
principal method, Lundbeck has changed its accounting policy with respect to
presentation of the existing agreement concerning Azilect(®).
On conclusion of the new agreement, Lundbeck believes that the company is acting
as principal in respect of total Azilect(®) sales. This means that Azilect(®)
will henceforth be treated for accounting purposes in the same way as Lundbeck's
other products, for which the company pays a proportion of the revenue or
earnings to an external partner. As a result of the change, Azilect(®) will
henceforth make a full contribution to consolidated revenue, whilst license
payments to Teva will be recognised as part of cost of sales, as opposed to the
previous policy under which revenue from Azilect(®) was recognised net of
As a result of the change in accounting policy, revenue from Azilect(®) during
the first nine months of 2009 will be DKK 545 million, against the previously
reported figure of DKK 259 million. Cost of sales for the first nine months of
2009 will be DKK 1,915 million, against the previously reported figure of DKK
The policy change will not affect Lundbeck's profit from operations (EBIT).
Comparative figures will be presented in connection with the publication of the
annual report for 2009.
As a consequence of the change in accounting policy with regards to Azilect(®)
revenue, Lundbeck expects total revenue for 2009 to be slightly higher than the
guided range of DKK 13.1-13.6 billion. Apart from this, guidance for 2009
Lundbeck will present its financial result for 2009 on 4 March 2010. On the same
occasion Lundbeck will present the expectations for the financial result for
Azilect(®) (rasagiline tablets), a registered trademark that belongs to Teva,
are indicated for the treatment of the signs and symptoms of Parkinson's disease
both as initial therapy alone and to be added to levodopa later in the disease.
Azilect(®) is now available in 38 countries, including the US, Canada, Israel,
Mexico and all of the EU countries. Lundbeck has the rights to market Azilect(®)
in Europe (in collaboration with Teva in the UK, France and Germany) and in
China, South Korea, Malaysia, Hong Kong, The Philippines, Thailand, and a few
other countries outside Europe.
About Parkinson's disease
Parkinson's disease is an age-related degenerative disorder of the brain.
Symptoms can include tremor, stiffness, slowness of movement and impaired
balance. An estimated four million people worldwide suffer from the disease,
which usually affects people over the age of 60.
Jacob Tolstrup Mads Kronborg
Vice President, IR & Communication Media Relations Manager
+45 36 43 30 79 +45 36 43 28 51
Palle Holm Olesen
Head of Investor Relations
+45 36 43 24 26
Magnus Thorstholm Jensen
Investor Relations Officer
+45 36 43 38 16
H. Lundbeck A/S (LUN.CO, LUN DC, HLUKY) is an international pharmaceutical
company highly committed to improve the quality of life for people suffering
from central nervous system (CNS) disorders. For this purpose Lundbeck is
engaged in the research and development, production, marketing and sale of
pharmaceuticals across the world, targeted at disorders like depression and
anxiety, schizophrenia, insomnia, Huntington's, Alzheimer's and Parkinson's
Lundbeck was founded in 1915 by Hans Lundbeck in Copenhagen, Denmark, and
employs today over 5,500 people worldwide. Lundbeck is one of the world's
leading pharmaceutical companies working with CNS disorders. In 2008, the
company's revenue was DKK 11.3 billion (approximately EUR 1.5 billion or USD
2.2 billion). For more information, please visit www.lundbeck.com.
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