Merrimack Pharmaceuticals Inc (NASDAQ:MACK) stock was up on Monday following news that it will sell some of its drugs to Ipsen.
The deal between Merrimack Pharmaceuticals Inc and Ipsen will have the biopharmaceutical company selling Onivyde to the latter. This is MACK’s first commercial product. Th deal includes the commercialization rights in the United States and the company’s licensing agreement with Shire PLC (ADR) (NASDAQ:SHPG)
Merrimack Pharmaceuticals Inc’s deal with Ipsen will also have it selling the latter Doxil. Doxil is the company’s generic version of doxorubicin hydrochloride (HCI) liposome injection. The drug was advanced via a development, license and supply agreement with Actavis, which is a subsidiary of Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA).
Merrimack Pharmaceuticals Inc will make $1.025 billion with the sale of these two drugs to Ipsen. There is also $33 million in net milestone payments that MACK is retaining from its exclusive licensing agreement with Shire PLC (ADR).
Merrimack Pharmaceuticals Inc is expecting the deal with Ipsen to close during the first quarter of 2017. The deal still needs approval from MACK shareholders, as well as from government regulators.
Merrimack Pharmaceuticals Inc also says that it has determined its new focus moving forward. These focuses are the MM-121, MM-141 and MM-310 programs. It believes that these programs have the highest chances of success with significant returns.
Once Merrimack Pharmaceuticals Inc completes its shift of focus and the transaction with Ipsen, it will reduce its workforce by 80%. This will leave it with just 80 of its current 400 employees.
MACK stock was up 6% as of Noon Monday.