|I would not have expected this. |
Novo Nordisk Expands Licensing Rights to AERx(R) iDMS Inhaled Insulin Program From Aradigm and Obtains Full Development and Manufacturing Rights
Tuesday September 28, 7:00 pm ET
BAGSVAERD, Denmark and HAYWARD, Calif., Sept. 28 /PRNewswire-FirstCall/ -- Novo Nordisk (NYSE: NVO - News) and Aradigm Corporation (Nasdaq: ARDM - News) today announced an agreement giving Novo Nordisk full development and manufacturing rights to the AERx® insulin Diabetes Management System (iDMS) program. Under the agreement, Novo Nordisk will purchase manufacturing equipment and leasehold improvements currently utilized by Aradigm in the AERx® iDMS program for an estimated cash payment of USD 55 million. Novo Nordisk will assume all further responsibilities for AERx® iDMS development and funding. Aradigm will maintain a long-term interest in the program through an adjusted royalty on future AERx® iDMS net sales.
As a result of the expanded licensing agreement, Novo Nordisk has formed a new affiliate, Novo Nordisk Delivery Technologies, Inc. based in Hayward, California, which will assume the leases and operational overhead on two of Aradigm's current three buildings, and will offer employment to approximately 130 Aradigm employees who have been dedicated to iDMS. The companies have the option to continue collaborating in specific areas such as next-generation AERx® technologies. If needed, Novo Nordisk will provide certain contract manufacturing services to support other AERx® programs for up to three years.
"Novo Nordisk remains committed to the development of inhaled insulin. The AERx® iDMS is an excellent fit within our portfolio of insulin delivery systems," stated Lars Rebien Sorensen, president and chief executive officer of Novo Nordisk. "We are confident that the transition will be smooth, and that both companies will benefit from the new structure."
"We are pleased that Novo Nordisk has assumed a greater role in completing the development of the AERx® iDMS system," added Dr Bryan Lawlis, Aradigm's president and chief executive officer. "This agreement establishes two key components for Aradigm's future success: it confirms Novo Nordisk's commitment to the AERx® iDMS program, and it provides Aradigm the financial flexibility to accelerate the development of additional AERx® and Intraject® applications. In addition to the cash payment at closing, Aradigm will no longer be responsible for the expenditures associated with commercial scale-up and manufacturing of AERx® iDMS."
Finalization of the agreement is subject to customary closing conditions, including approvals from regulatory authorities, as well as approval from Aradigm common and preferred shareholders, which is expected at a special shareholder's meeting to be held later in 2004. The agreement is expected to close by the end of 2004. The transaction does not change Novo Nordisk's expectations for the financial results for 2004.