I love it when joint press releases sound all chummy as the companies try to hide their disdain in having to work with each other.
That was the case last week as Johnson & Johnson
If you're wondering why big old J&J needs relatively small Schering to market REMICADE to the rest of the world, the answer is that it doesn't. Schering licensed the rights to sell REMICADE -- and the option for golimumab -- from Centocor in 1998, the year before J&J bought the company.
In fact, J&J has been trying to get out of its agreement for a while, but last year, an arbiter decided that Schering had the right to sell golimumab for 15 years. It looks like J&J has finally given in.
Under the agreement, Schering has the right to independently develop and market golimumab for Crohn's disease in certain territories, and Centocor will have the option to participate in the program. The European market is fairly wide open since Elan's
The companies will also be developing an auto-injector device that allows patients to self-administer golimumab. The development will cost Schering $20.5 million this year but should pay dividends once the product is launched.
Shoring up the agreement is clearly an advantage for Schering. Its Schering's second most important partnership next to its cholesterol drug partnership with Merck
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Fool contributor Brian Orelli, Ph.D., doesn't own shares of any company mentioned in this article. Biogen is a pick of the Stock Advisor newsletter. Johnson & Johnson is a selection of the Income Investor newsletter. The Fool has a disclosure policy.