Lundbeck is a well know producer of medical products in the treatment of depression and other psychiatric related deceases but also a products that includes the controversial product Nembutal that is used on death row.
Until recently has the U.S. market been an important growth area for Lundbeck. The new agreement allows the company to focus on newer, strategic products with significant sales potential as Onfi and at the same time get out of an ethical problem that has haunted the company for the past two years.
The company has been accused of supporting the death penalty in the US by providing a product, Nembutal, which was used as part of the drugs that condemned people got when they were put down.
Lundbeck has agreed to a deal where the company gets an upfront payment and a subsequent milestone payment after three years that, as a maximum will amount to 60 million. U.S. dollars. The company points out that the Danish pharmaceuticals group, will not receive royalties on future sales of Nembutal.
Lundbeck will instead focus on new strategic products in its portfolio. The buyer Akorn is continuing the Lundbeck restricted distribution program of Nembutal, which was implemented to limit the use of the product in the U.S.
The maneuver that Lundbeck have implemented looks very much like the one that Dow Chemical used when they stopped producing Napalm in the 70ties as a consequence of increase public pressure.