The University of California, Los Angeles, has joined an elite group of academic institutions to hit the drug discovery jackpot. Royalty Pharma, a company that buys drug royalty rights, has paid $1.14 billion for part of the royalty rights for Medivation’s prostate cancer drug Xtandi, which was discovered by UCLA chemist Michael Jung and physician Charles Sawyers.
The university will receive about half of that sum. Also benefiting are UCLA’s chemistry department, the inventors, and Howard Hughes Medical Institute, where Sawyers was a researcher at the time of the drug’s invention.
UCLA says the money will be put into an investment portfolio that should yield roughly $60 million annually until 2027. Those proceeds will allow UCLA to support research, undergraduate scholarships, and graduate student fellowships.
The payout was more than a decade in the making. In 2005, Medivation licensed a collection of androgen receptor inhibitors, including Xtandi, discovered by Jung and Sawyers. Xtandi received FDA approval to treat prostate cancer in 2012; last year, sales of the drug totaled $1.9 billion.
The deal makes UCLA one of a handful of academic institutions to see a major windfall from a molecule invented inside its labs. In 2007, Northwestern University scored $700 million from Royalty Pharma for the royalties on Pfizer’s pain pill Lyrica. That same year, New York University raked in $650 million from Royalty Pharma for some of its rights to the arthritis treatment Remicade.
But the high financial stakes can also bring strife. UCLA has had a tense relationship with Medivation that has resulted in a tangle of lawsuits over ownership of the drug and related molecules. After Medivation bought the rights to a series of androgen receptor inhibitors from UCLA, Jung and Sawyers patented similar molecules, which became the basis for Aragon Pharmaceuticals. Medivation claimed in a lawsuit that it had a right to license those compounds as well.
Medivation lost its suit in 2012. Two years later, UCLA filed a countersuit over what it believes is its portion of profits on Xtandi. That case has yet to be settled.