BioMarin Pharmaceutical And Genzyme Restructure Equally Owned Joint Venture Regarding Aldurazyme

BioMarin Pharmaceutical, Inc. (BMRN), a developer and marketer of biopharmaceuticals for serious diseases and medical conditions and biotechnology company Genzyme Corp.

(GENZ) announced restructuring of their equally owned joint venture regarding Aldurazyme.
The new structure is expected to provide both companies a better alignment of financial incentives with operational decisions and represents a more appropriate structure for two companies manufacturing and commercializing multiple products.

According to the revised structure, the operational responsibilities for BioMarin and Genzyme would not significantly change. Genzyme would continue to globally market and sell Aldurazyme for mucopolysaccharidosis I, or MPS I, and BioMarin would continue to manufacture Aldurazyme.

Payments are projected to result in both BioMarin and Genzyme receiving approximately the same profit as under the original joint venture structure. BioMarin would receive all of the benefits from increased manufacturing efficiencies and Genzyme would receive all of the benefits from increased commercialization efficiencies.

As of January 1, 2008, instead of sharing all costs and profits equally through the 50/50 joint venture, Genzyme would record sales of Aldurazyme and would pay BioMarin a tiered payment ranging from nearly 39.5%-50% of worldwide net product sales, which would also be recorded by BioMarin as product revenue.

Certain research and development activities related to Aldurazyme and intellectual property will continue to be managed in the joint venture on a 50/50 basis.

Jean-Jacques Bienaime, Chief Executive Officer of BioMarin said, "This structure will also reduce management time and provide stronger incentives for each company to maximize the efficiency of its own operations related to Aldurazyme. Lastly, this new structure allows the companies to collaborate and equally share costs on research projects which could lead to important advances for MPS I patients."

GENZ closed Thursday's regular trade at $75.41, up 66 cents or 0.88% from its prior closing. BMRN closed Thursday's regular trading session at $37.19, up $0.55 or 1.50%. In the after hours trading, the stock gained a penny or 0.03% to trade at $37.20.

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