WASHINGTON (dpa-AFX) - Avadel Pharmaceuticals plc (AVDL) on Wednesday announced a global settlement resolving all litigation with Jazz Pharmaceuticals Inc. (JAZZ).
Under the terms of the settlement, Avadel and Jazz will dismiss all pending litigation with prejudice.
Jazz will grant Avadel a perpetual, worldwide license to any past, present, or future patents that could be asserted against LUMRYZ for all indications, strengths, conditions of use, dosages, and presentations. In addition, Jazz will pay $90 million to Avadel and waive its right to receive royalties or damages on past LUMRYZ sales through September 30, 2025. Jazz has also agreed not to challenge the approvability of LUMRYZ for any current or future indications, such as idiopathic hypersomnia. Beginning no earlier than March 1, 2028, LUMRYZ may be marketed for any future FDA-approved indication.
Additionally, as part of the settlement, Avadel will grant Jazz a perpetual, worldwide, royalty-free, fully paid-up covenant not to sue relating to Avadel's patents in connection with Jazz's Xywav and Xyrem products, covering all current and future indications, strengths, dosages, and formulations. Beginning October 1, 2025, Avadel will pay Jazz ongoing royalties of 3.85%-subject to potential reduction to 3.75%-on net sales of LUMRYZ in narcolepsy through February 18, 2036. Starting no earlier than March 1, 2028, LUMRYZ sold for any future FDA-approved indication will also be subject to a royalty of 10%, potentially reduced to 9.5%, on net sales through the same date.
LUMRYZ is an extended-release sodium oxybate medication approved by the FDA for the treatment for cataplexy or excessive daytime sleepiness (EDS) in patients with narcolepsy.
'This settlement provides Avadel with long-term clarity on its intellectual property position and commercial rights. With a defined pathway for LUMRYZ in idiopathic hypersomnia, including a certain entry date as early as March 1, 2028, we believe Avadel is well-positioned to advance its differentiated sleep medicines portfolio,' Avadel said in a statement.
On Tuesday, Avadel shares rose 13% before closing at $17.87.
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