ST. LOUIS, and SAN DIEGO, May 8 /PRNewswire/ -- Molecular Biosystems, Inc.
(OTC Bulletin Board: MBIO) and Mallinckrodt Inc. (NYSE: MKG) announced today
the restructuring of their agreement concerning OPTISON(R), the only U.S. Food
and Drug Administration-approved intravenous ultrasound contrast agent. Under
the terms of the agreement, Mallinckrodt will assume full control of the
OPTISON business, including responsibility for intellectual property disputes,
clinical development, manufacturing and real estate.
The announcement about the restructured agreement between Molecular
Biosystems and Mallinckrodt follows an earlier news release on Monday that a
settlement had been reached in three ongoing patent disputes in Washington,
D.C., Seattle, Wash., and Europe between Nycomed Amersham plc
(London: NAM; NYSE: NYE), Mallinckrodt, Molecular Biosystems (MBI) and SONUS
Pharmaceuticals Inc. In addition, Nycomed and Mallinckrodt announced the
formation of an alliance in the ultrasound business for the development and
marketing of ultrasound contrast agents, starting with OPTISON.
As a result of Molecular Biosystems and Mallinckrodt's restructured
agreement, MBI will receive an ongoing royalty of 5 percent on sales of
ultrasound contrast agents by Mallinckrodt and Nycomed in the Mallinckrodt
territory, which is worldwide, excluding Japan, South Korea and Taiwan. In
addition, MBI will pay a total of $7 million to Mallinckrodt as part of the
intellectual property settlement, $3 million of which will be paid initially.
Chugai Pharmaceuticals, one of the six largest pharmaceutical companies in
Japan, is MBI's partner for Japan, South Korea and Taiwan. Japan is estimated
to be the second largest market for contrast agents in the world. Chugai
recently initiated Phase III studies for both the myocardial perfusion
indication and for liver imaging, the latter regarded by independent experts
as the primary opportunity in Japan. MBI receives a 28 percent royalty plus
certain milestone payments from Chugai and has no manufacturing or clinical
development responsibilities.
Molecular Biosystems' Chief Executive Officer Bobba Venkatadri, commented,
"It was necessary to restructure our agreement with Mallinckrodt at this time
to limit our current expenses and ensure the potential for future shareholder
value. It was a very difficult decision. However, because of the slow
ramp-up of OPTISON sales in the U.S. and Europe and escalating legal expenses
to Molecular Biosystems (in excess of 40% of MBI's current expenses),
management and the Board of Directors determined that it was in the best
interest of the shareholders to take this action. We are pleased that OPTISON
will be co-promoted by two world leaders in the contrast media business and
look forward to the financial benefit of this new alliance. With the new
agreement, MBI can focus its efforts going forward on assisting Chugai with
its development of FS069 and can also pursue several strategic alternatives
with regard to corporate development which now become available to us."
Mallinckrodt Imaging Group President Bradley J. Fercho said,
"Mallinckrodt's restructured agreement with Molecular Biosystems, coupled with
our agreement with Nycomed Amersham, provide exciting opportunities for
enhancing the development of additional cardiology and radiology indications
beyond those existing today in the ultrasound field. We have made major
investments to develop the ultrasound field and to enhance the utility of
ultrasound as a diagnostic tool and are excited about the potential for the
future. The plans for making the transition in our working relationship with
Molecular Biosystems will be completed in the near future."
MBI, based in San Diego, California, is a world leader in developing
contrast agents for diagnostic imaging. Its innovative product, OPTISON,
enables improved diagnosis of heart disease through clearer ultrasound images.
Mallinckrodt Inc. is a global manufacturer and marketer of specialty
medical products designed to sustain breathing, diagnose disease and relieve
pain. Named one of America's most admired medical products and equipment
companies by Fortune magazine, Mallinckrodt does business in more than
100 countries. In fiscal 1999, combined net sales were $2.6 billion for
Mallinckrodt's respiratory, imaging and pharmaceutical product lines. Based
in St. Louis, Missouri, Mallinckrodt's website address is
( http://www.mallinckrodt.com ).
This news release contains forward-looking statements that involve risks
and uncertainties. These statements are based on current expectations; actual
results may differ materially. Among the factors that could cause actual
results to differ materially from those projected are the following: the
effect of business and economic conditions; the impact of competitive products
and continued pressure on prices realized by the company for its products;
constraints on supplies of raw materials used in manufacturing certain of the
company's products; capacity constraints limiting the production of certain
products; difficulties or delays in the development, production, testing, and
marketing of products; difficulties or delays in receiving required
governmental or regulatory approvals; market acceptance issues, including the
failure of products to generate anticipated sales levels; difficulties in
rationalizing acquired businesses and in realizing related cost savings and
other benefits; the effects of and changes in trade, monetary and fiscal
policies, laws and regulations; foreign exchange rates and fluctuations in
those rates; the costs and effects of legal and administrative proceedings,
including environmental proceedings and patent disputes involving the company;
difficulties or delays in addressing "Year 2000" problems in the company's
operations, or the inability of a major supplier or customer to continue
operations due to such problems; and the risk factors reported from time to
time in the company's SEC reports. The company undertakes no obligation to
update any forward-looking statements as a result of future events or
developments.
SOURCE Mallinckrodt Inc.
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Related links:
http://www.mallinckrodt.com
Company News On-Call:
http://www.prnewswire.com/comp/440950.html or fax,
800-758-5804, ext. 440950
CONTACT:
Media, Barbara Abbett, 314-654-5230, e-mail,
barbara.abbett@mkg.com, Investors, Robert Martsching,
314-654-3190, e-mail, Invest@mkg.com, both of Mallinckrodt Inc.,
or Howard Dittrich, M.D. of Molecular Biosystems, 858-812-7042
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