Exhibit 99.1
Contacts:
ORGANON LIGAND
Fran DeSena Paul V. Maier
Director, Communications Senior VP and Chief
and Media Relations Financial Officer
973-325-5353 858-550-7573
ORGANON, LIGAND TO CO-PROMOTE AVINZA(R),
FIRST TRUE ONCE-DAILY OPIOID FOR CHRONIC, MODERATE-TO-SEVERE PAIN
-- Companies Expect to Achieve No. 2 Share of Voice in $2.7 Billion Marketplace
With More than 800 Sales Representatives --
ROSELAND, NJ AND SAN DIEGO, CA; FEBRUARY 24, 2003 - Organon, a business
unit of Akzo Nobel (Nasdaq: AKZOY), and Ligand (Nasdaq: LGND) will co-promote
Ligand's AVINZA(R) (morphine sulfate extended-release capsules), the first true
once-daily opioid for chronic, moderate-to-severe pain, with more than 800 sales
representatives in the United States, the companies announced today.
"Organon is absolutely delighted with this co-promotion agreement with
Ligand, and we look forward to working with our new partner on this exciting
business opportunity," said Michael Novinski, president of Organon
Pharmaceuticals USA Inc. "Based on its true once-daily oral dosing and
around-the-clock pain relief, AVINZA can be a best-in-class product in a large
and growing market. AVINZA also is a great fit for our product portfolio, and
uses the strengths and relationships we have established over the years in
primary care, anesthesiology and hospitals. We are truly excited about this
unique sales opportunity and look forward to a prosperous and long-term
relationship with Ligand."
"We are very pleased to co-promote AVINZA with our colleagues at Organon,"
said David E. Robinson, chairman, president and chief executive officer of
Ligand. "Through this agreement, we have achieved the three key AVINZA goals we
set out to accomplish for our shareholders in the second half of 2002 and early
2003. First, we gained strong partner resource commitments in primary care,
hospitals and managed care to maximize AVINZA's potential as our largest
near-term commercial opportunity. Second, we structured a risk/return-balanced
set of economics that incentivizes our partner to achieve much greater success
than Ligand could alone, that provides a positive operational EPS driver to
Ligand, and that enables
an attractive return on our cumulative investments in AVINZA. Third, we
strengthened our capabilities in retail and wholesale distribution, medical
marketing and managed care to support AVINZA. We believe this long-term
relationship with Organon builds on positive AVINZA prescription trends and
represents another giant step forward with roll out of our joint efforts
beginning in March and April."
Organon and Ligand expect AVINZA to achieve the No. 2 share of voice in the
sustained-release opioid marketplace with a combined sales force of more than
800 representatives, and appropriately scaled investments in other medical
marketing. Ligand will promote AVINZA with its expanding specialty pain sales
force of nearly 70 representatives. Organon will promote the product with more
than 700 representatives in three sales forces: primary care, hospital
(anesthesiology) and specialty (pain centers). In addition, Organon brings
critical capabilities with key accounts, managed care and long-term care to
accelerate AVINZA's growth. FINANCIAL STRUCTURE AND GOVERNANCE
Under the companies' agreement, Ligand will record all sales of AVINZA.
Ligand will pay Organon a percentage of AVINZA's net sales based on the
following schedule:
- ---------------------------------- ---------------------------------
ANNUAL NET SALES OF AVINZA % OF INCREMENTAL NET SALES
PAID TO ORGANON BY LIGAND
- ---------------------------------- ---------------------------------
$0-35 million (2003 only) 0% (2003 only)
- ---------------------------------- ---------------------------------
$0-150 million 30%
- ---------------------------------- ---------------------------------
$150-300 million 40%
- ---------------------------------- ---------------------------------
$300-425 million 50%
- ---------------------------------- ---------------------------------
> $425 million 45%
- ---------------------------------- ---------------------------------
Organon and Ligand will share equally all costs for advertising and
promotion, medical affairs and clinical trials. Each company is responsible for
its own sales force costs and other expenses. Both companies have made
significant commitments to conduct a minimum number of sales calls, with AVINZA
in primary or secondary position, over the term of the agreement.
The initial term of the co-promotion agreement, which applies only to the
U.S. market, is 10 years. Any time prior to the end of year five, Organon has an
option to extend the agreement to 2017, the end of a key AVINZA patent's term,
by making a $75 million milestone payment to Ligand.
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To provide overall governance of the partnership, Organon and Ligand will
establish a steering committee with three senior executives from each company.
The chair of the steering committee will alternate between Organon and Ligand on
an annual basis. Organon and Ligand also will form a commercial committee to
design and coordinate all sales, marketing and distribution activities for
AVINZA. The commercial committee will be co-chaired by one Organon and one
Ligand employee. The commercial committee will establish a clinical/regulatory
subcommittee to design and coordinate all medical, clinical and regulatory
activities for AVINZA.
ABOUT AVINZA
In March 2002, the U.S. Food and Drug Administration granted marketing
approval for AVINZA for the once-daily treatment of moderate-to-severe pain in
patients who require continuous, around-the-clock opioid therapy for an extended
period of time. Ligand launched the product in mid-2002. AVINZA was developed by
Elan, which licensed the U.S. and Canadian marketing rights to Ligand in 1998.
AVINZA competes in the branded sustained-release opioid marketplace, which
grew 16% in 2002 to approximately $2.7 billion. Despite this growth, studies
indicate that as many as 30-85% of select chronic pain patients still are
undertreated.
Full prescribing information for AVINZA may be obtained in the U.S. from
Ligand Professional Services by calling toll free 800-964-5836 or on Ligand's
web site at HTTP://WWW.LIGAND.COM.
WEB CAST CONFERENCE CALL
Ligand will host a live web cast, open to all interested parties, of a
conference call during which Ligand and Organon management will discuss this
transaction. The web cast will last approximately 30 minutes and be available at
WWW.LIGAND.COM (investor relations page) and WWW.STREETEVENTS.COM (password
protected) at 8:30 a.m. Eastern Time (5:30 a.m. Pacific Time) Tuesday, February
25.
ABOUT ORGANON
Organon Pharmaceuticals USA Inc. is part of the Akzo Nobel N.V. business
unit Organon, a renowned pharmaceutical company with a strong commitment to
human health care. The company develops and produces innovative prescription
medicines for gynecology, psychiatry, cardiovascular
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disease, immunology and anesthesia. Organon products are sold in over 100
countries, more than half of which have an Organon subsidiary. The company
currently employs around 13,000 people worldwide. Organon is the human health
care business unit of Akzo Nobel. For more information, see www.organonusa.com.
ABOUT LIGAND
Ligand discovers, develops and markets new drugs that address critical
unmet medical needs of patients in the areas of cancer, skin diseases, men's and
women's hormone-related diseases, osteoporosis, metabolic disorders, and
cardiovascular and inflammatory diseases. Ligand's proprietary drug discovery
and development programs are based on its leadership position in gene
transcription technology, primarily related to Intracellular Receptors (IRs) and
Signal Transducers and Activators of Transcription (STATs). For more
information, see www.ligand.com.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This news release contains certain forward-looking statements by Ligand and
Organon that involve risks and uncertainties and reflect the companies' judgment
as of the date of this release. These statements include those related to
co-promotion implementation, sales and market growth, product potential and
success, EPS, share of voice and number of sales representatives, and the option
to extend the agreement. Actual events or results may differ from the companies'
expectations. For example, there can be no assurance that co-promotion will be
successful or that AVINZA sales will meet expectations. Additional information
concerning these and other risk factors affecting Ligand's and Organon's
businesses can be found in prior press releases as well as in the companies'
public periodic filings with the Securities and Exchange Commission, available
via the companies' respective internet sites. Ligand and Organon disclaim any
intent or obligation to update these forward-looking statements beyond the date
of this release. This caution is made under the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995.
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