On February 27, 2017, Perrigo Company plc ("Perrigo"), Perrigo Pharma International Designated Activity Company, an Irish designated activity company and a wholly owned subsidiary of Perrigo ("Perrigo DAC"), and RPI Finance Trust, a Delaware statutory trust ("RPI"), an affiliate of Royalty Pharma, entered into a purchase and sale agreement (the "Agreement").
The Agreement provides that Perrigo DAC will sell to RPI all of its rights to receive royalty payments from and after January 1, 2017 arising in respect of worldwide net sales of Tysabri® pursuant to the asset purchase agreement, dated February 5, 2013, by and among Perrigo affiliates and Biogen Idec International Holding Ltd. (the "Original Asset Purchase Agreement"). RPI will pay Perrigo DAC a cash purchase price of up to $2.85 billion, composed of $2.2 billion at closing, plus additional payments of (a) $250 million if the Tysabri® royalty amounts payable pursuant to the Original Asset Purchase Agreement for the twelve months ended December 31, 2018 meet specified thresholds and (b) $400 million if the Tysabri® royalty amounts payable pursuant to the Original Asset Purchase Agreement for the twelve months ended December 31, 2020 meet specified thresholds.
Perrigo DAC will also assign to RPI certain information and audit rights related to the Tysabri® royalties, and the Agreement provides for the allocation of certain obligations of Perrigo DAC under the Original Asset Purchase Agreement.
The Agreement contains various representations and warranties, covenants, indemnification obligations and other provisions customary for transactions of this nature. Perrigo has provided a limited guarantee of Perrigo DAC's obligations under the Agreement.
The Agreement provides that the transaction will close within 20 business days, subject to customary closing deliverables, including an assignment and assumption agreement as provided in the Agreement. The date of the closing may be extended by 10 business days at RPI's option, upon RPI making a $1 billion purchase price deposit with Perrigo DAC. The deposit is refundable in certain circumstances.
The foregoing summary of the Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K ("Current Report") and incorporated herein by reference.
On February 27, 2017, Perrigo issued a press release announcing execution of the Agreement and the matters described in Item 1.01. A copy of the press release is furnished as Exhibit 99.1 to this Current Report.
