DEERFIELD, Ill., July 31, 2013 - Baxter International Inc. (NYSE:BAX) and JW Holdings today announced that they have entered into an exclusive distribution and license agreement for parenteral nutritional products containing a novel formulation of omega 3 lipids. With this collaboration, Baxter will complement its leading global parenteral nutrition portfolio, and provide global commercial capabilities and clinical development.
Under the terms of the agreement, Baxter will have exclusive rights to co-develop and distribute the products globally, with the exception of Korea. The arrangement includes a $25 million up-front payment that will be recorded as a special pre-tax in-process research and development charge in the third quarter of 2013. Additionally, the agreement calls for payments totaling up to $10 million for the achievement of regulatory milestones, along with royalties on future product sales.
The agreement remains in effect for 10 years following the first product launch outside of Korea. The companies will share equally in the development costs and global clinical trials and registrations. JW Holdings will manufacture the products in its Dangjin, Korea facility. Additionally, Baxter has specified rights to certain additional nutritional products that JW Holdings may develop or produce in the future.
"Lipids are an important part of nutrition therapy, particularly for those patients who rely on parenteral feeding for sole-source or supplemental nutrition," said Robert M. Davis, president of Baxter's Medical Products business. "Baxter's collaboration with JW Holdings allows us to complement our existing parenteral nutrition product portfolio and provide clinicians with additional options to meet patients' unique nutritional needs."
"The agreement with Baxter expands our ability to help more patients benefit from parenteral nutritional products containing our novel formulation of omega 3 lipids," said, Gu Seo Park, chief operating officer of JW Holdings. "Both companies are bringing unique technology and expertise to this collaboration, which also will create new opportunities for JW Holdings to grow and gain recognition globally."
Baxter International Inc., through its subsidiaries, develops, manufactures and markets products that save and sustain the lives of people with hemophilia, immune disorders, infectious diseases, kidney disease, trauma, and other chronic and acute medical conditions. As a global, diversified healthcare company, Baxter applies a unique combination of expertise in medical devices, pharmaceuticals and biotechnology to create products that advance patient care worldwide.
About JW Holdings
JW Holdings operates as a holding company of JW Pharmaceutical which is one of the leading pharmaceutical companies in Korea. JW Group, since its foundation in 1945, has been leading therapeutic medicine industry in Korea with the business motto represented by "Respect for Life" and "Pioneering Spirit." JW Group is committed to providing medicine and medical supplies in the areas including I.V. solution and circulatory, digestive, and urinary system treatments. The JW Holdings plant located in Dangjin is the largest medical manufacturing complex in Korea that supplies various medical products including non-PVC I.V. solutions and is equipped with a cutting-edge automated control system while satisfying international GMP standard.
This release includes forward-looking statements concerning a development and commercialization agreement between Baxter International Inc. and JW Holdings, including expectations with regard to the financial impact of such agreement on the company and future regulatory milestone payments. The statements are based on assumptions about many important factors, including the following, which could cause actual results to differ materially from those in the forward-looking statements: satisfaction of regulatory and other requirements; actions of regulatory bodies and other governmental authorities; clinical trial results; changes in laws and regulations; product quality or patient safety issues; and other risks identified in Baxter's most recent filings on Form 10-K and other SEC filings. Baxter does not undertake to update its forward-looking statements.