) recently completed the sale of its rights to Actimmune to Vidara
Therapeutics International Limited for $55 million plus royalties.
Vidara is part of an international group of companies operating in
the US and Ireland.
As per the agreement, InterMune received $55 million in cash
from Vidara. Moreover InterMune will receive royalty payments on
Actimmune sales over a two-year period. InterMune expects royalty
payments to be around $2-$4 million over the period.
Actimmune is approved for the treatment of chronic granulomatous
disease (CGD) and severe, malignant osteoporosis. Actimmune sales
for the year 2011 were $20.2 million. Management nonetheless
conceded that Actimmune has so far been the company's tactical
financial asset. We believe that the sale of Actimmune will allow
InterMune to focus on marketing its lead drug Esbriet (pirfenidone
in the US). Esbriet is available in Germany for treating patients
suffering from idiopathic pulmonary fibrosis (IPF). Esbriet is
expected to be launched in other EU nations during the course of
Expense Guidance for 2012
Apart from announcing the closure of the divestment, InterMune
also adjusted its guidance for operating expenses in 2012. The
company currently expects research and development (R&D)
expenses in the range of $90-$105 million (old guidance: $95-$115
million) this year. The increase was primarily attributable to the
expenses expected to be incurred in relation to the phase III study
(ASCEND) to support the approval of pirfenidone for treating IPF
patients in the US. The enrollment for the study is expected to be
completed by the end of this year. We remind investors that the US
Food and Drug Administration (FDA) issued a complete response
letter (CRL) in May 2010 for Esbriet. Moreover, the delay of
investments related to certain non-Esbriet R&D activities also
contributed to the increased guidance.
InterMune forecasts selling general and administrative
(SG&A) in 2012 in the range of $110-$130 million (old guidance:
$120-$145 million). The decrease was attributable to the pricing
and reimbursement discussions for Esbriet in Europe.
We currently have a Neutral recommendation on InterMune, which
carries a Zacks #3 Rank (short-term 'Hold' rating).
INTERMUNE INC (ITMN): Free Stock Analysis
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