Eli Lilly announced an agreement to sell the rights in China for its two antibiotic medicines Ceclor (cefaclor) and Vancocin (vancomycin), as well as a manufacturing facility in Suzhou, to Eddingpharm under a deal worth $375 million. Julio Gay-Ger, general manager of Lilly China, said the transaction "will enable Lilly China to better focus our resources on the exciting new therapies that we are launching in our core therapeutic areas."
Under the agreed terms, Eli Lilly will receive a deposit of $75 million, followed by a payment of $300 million upon closing of the transaction. Eli Lilly noted that all employees at the Ceclor manufacturing site and certain staff from shared functions will be offered the opportunity to remain at the facility and continue to work with Eddingpharm.
In 2016, Eli Lilly granted Eddingpharm exclusive rights to promote and distribute Ceclor and Vancocin in China. However, late last year, sources suggested that Eli Lilly was looking to divest a portfolio of off-patent drugs, including antibiotics and drugs for central nervous system diseases, in China in a bid to raise cash.
Eli Lilly noted that the transaction with Eddingpharm is expected to close in either the latter part of 2019 or early 2020.
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