Vertex sells Incivo royalty rights to Janssen for $152 million

Loss-making US biotech firm Vertex Pharmaceuticals (Nasdaq: VRTX) says that it has sold its product royalty rights relating to hepatitis C drug Incivo (telaprevir) to partner US health care giant Johnson & Johnson’s (NYSE: JNJ) Janssen Pharmaceutica subsidiary.

Under the agreement, Janssen will make a $152 million cash payment to Vertex in the fourth quarter of 2013 and will cease paying royalties to Vertex on Incivo sales beginning in 2014. Vertex shares rose 4.4% to $65.14 by close of trading yesterday (November 20).

"The monetization of Incivo royalties provides cash to enhance our corporate financial position and continues to position us to support our investment in cystic fibrosis and to advance other key opportunities in our pipeline,” said Ian Smith, executive vice president and chief financial officer of Vertex.