Cutting Edge Information Analyzes the Bristol-Myers Squibb / Otsuka Pharma Profit-Sharing Strategy for 2010 and Beyond

RESEARCH TRIANGLE PARK, NC--(Marketwire - April 16, 2009) - The recently announced deal between Bristol-Myers Squibb and Otsuka over Abilify will go a long way toward shoring up both companies' revenue streams through 2015, according to pharmaceutical intelligence firm Cutting Edge Information. Perhaps more important than the revenue sharing is the marketing experience that Otsuka will gain as a resulting from each of these deals.

Under the new agreement that will decrease overall commercialization expenses, Bristol-Myers Squibb extended a marketing agreement with Otsuka over the antipsychotic drug Abilify. Under the previous deal with Otsuka, which was scheduled to end in November 2012, BMS assumed 100% of the US commercialization expenses for Abilify and received 65% of the US net sales. The new agreement sends an upfront cash payment of $400 million to Otsuka in exchange for more than 50% of the US net sales of Abilify through 2015, when the drug's patent protection lapses.

"Otsuka's restructuring of its North American subsidiary in February was intended to help it better market drugs worldwide, and Abilify is its most important product," says Jeremy Spivey, Cutting Edge Information research analyst. "As the company gains a stronger sales and marketing force in the North American market, it will be able to retain more of its products' profits, rather than partnering with other companies to assist with product marketing."

The new deal gives Otsuka some valuable exposure to marketing a blockbuster in the US, something with which the company has limited experience. Otsuka will now share 30% of the commercialization costs under the new deal and, in return, BMS will receive 58% of US net sales in 2010; 53.5% in 2011; and 51.5% for 2012. Between January 1, 2013, and 2015, Otsuka will assume 50% of the US commercialization expenses, and in return BMS will receive 50% of US net sales up to $2.7 billion.

A second deal involving two of BMS' oncology drugs -- Sprycel and Ixempra -- helps Otsuka gain experience marketing cancer drugs. The arrangement is timely because Otsuka currently has an oncology drug -- OPB-31121 -- in Phase I trials.

For more information on other pharmaceutical licensing arrangements within the neurodegenerative and oncology markets, download complimentary brochures for Cutting Edge Information's therapeutic area market forecast reports at

http://www.cuttingedgeinfo.com/neurodegenerative

and

http://www.cuttingedgeinfo.com/Oncology/index.htm#body

Contact Information: CONTACT: Jeremy Spivey 919-433-0373