LONDON Jan 17 British pharmaceutical firm Shire
said on Friday it had agreed to divest Dermagraft, a
bio-engineered skin substitute used to treat diabetic foot
ulcers, to Organogenesis for no upfront payment.
Shire acquired Dermagraft in June 2011 through its $750
million purchase of privately held Advanced BioHealing, but the
treatment failed to realise its development hopes when a
late-stage trial to treat venous leg ulcers disappointed later
The company said on Friday that the prospects for the
product had reduced significantly following a recent Medicare
ruling on reimbursement.
It said it would receive no upfront payment from Canton,
Massachusetts-based Organogenesis for the assets, but it would
be entitled to receive up to $300 million cash in total
milestone payments if it meets sales targets.
It said it would record a loss on disposal of approximately
$650 million in the fourth quarter of 2013, which will be
excluded from Non GAAP earnings.