Alkermes, Inc. (NASDAQ: ALKS) today announced that it has regained from Cephalon, Inc. full commercialization rights to VIVITROL® (naltrexone for extended-release injectable suspension) in the U.S. following a portfolio review by Cephalon. The collaboration between the two companies will terminate effective December 1, 2008. VIVITROL, the first and only long-acting injectable medication commercially available for the treatment of alcohol dependence, is also being developed by Alkermes as a potential treatment for opioid dependence. Cephalon will pay Alkermes $11 million to cover its share of the estimated losses on VIVITROL for the next 12 months and Alkermes will pay Cephalon $16 million to purchase manufacturing equipment for the product. Alkermes will recognize remaining milestone revenue and deferred revenue of approximately $120 million related to its previous agreements with Cephalon as net collaborative profit in the third quarter of fiscal 2009. Further terms of the agreement were not disclosed. “We continue to believe in the potential for VIVITROL to help patients struggling with alcohol dependence and are working to increase sales through a focus on high-impact activities with patients and physicians. We will, however, carefully manage our investments in VIVITROL to align with the sales trajectory for the product,” stated David Broecker, CEO of Alkermes. “Overall, we are very pleased to have worked with Cephalon. The collaboration funded key market development initiatives for VIVITROL. In addition, over the next 12 months, Cephalon will partially fund our commercial activities, enabling Alkermes to dedicate resources we believe will result in increased VIVITROL sales.” “We have a lot of opportunities on our plate and cannot give VIVITROL the focus it deserves,” said Frank Baldino, Jr., Ph.D., chairman and CEO of Cephalon. “Alkermes will be able to provide the necessary attention to this important product and we will work closely with them during this transition period to ensure that patients and physicians continue to have access to this important medication.” Following the termination of the collaboration, Alkermes will continue to market VIVITROL in the U.S. with a commercial team of approximately 70 individuals. The team will be fully staffed to manage sales, field and reimbursement support for VIVITROL. Commercial efforts for VIVITROL over the next 12 months will focus on improving three key areas, which include: increasing utilization among physicians currently prescribing VIVITROL; streamlining product access and reimbursement; and enhancing continuity of care for patients transitioning between treatment settings. During a transition period ending May 31, 2009, Cephalon will continue to work with Alkermes to ensure that patients and physicians have access to VIVITROL and that commercial activities are smoothly transitioned between the two companies.
