Enzon Sells Portion of PEG-INTRON Royalty

Enzon Pharmaceuticals, Inc. is selling 25% interest in its royalty from PEG-INTRON, marketed by Schering-Plough Corp. for $92.5 million to Drug Royalty Corp., Inc. (DRC). Enzon is also eligible to receive an additional one-time milestone payment of $15 million in 2012 if certain royalty recognition levels are met for PEG-INTRON. Enzon will retain a 75% interest in the PEG-INTRON royalty, as well as 100% of their other current royalties and any new royalties the company receives. Enzon plans to use a portion of the proceeds for repayment of outstanding debt due in 2008.

“Today’s announcement is a result of a thorough and comprehensive evaluation of our options to extinguish our debt due in 2008,” said Jeffrey H. Buchalter, chairman and chief executive officer of Enzon. “This transaction now fully removes any risk associated with repayment of the 2008 convertible note, and allows Enzon to continue to focus on its goal of building an innovative oncology company.”

Enzon currently earns royalties on three marketed products that use its PEGylation platform: PEG-INTRON, Pegasys, and Macugen.

PEG-INTRON is a PEG-enhanced version of Schering-Plough’s alpha interferon product, INTRON A, which is used both as a monotherapy and in combination with Rebetol (ribavirin) capsules for the treatment of chronic hepatitis C.