Here is why Intercept is up 30%

Intercept Pharmaceuticals Inc. (NASDAQ: ICPT) shares are up 30% after announcing an agreement to sell some of its foreign subsidiaries plus rights to its international operation, including the Ocaliva commercialization license outside the US, to Advanz Pharma. Advanz is a pharmaceutical firm with a strategic focus on hospital and specialty pharmaceuticals in the EU.

Intercept to receive $405 million in upfront payment on closing

CEO and President of Intercept Jerry Durso said:

After closing, Advanz Pharma will pay Intercept Pharmaceuticals an upfront payment of $405 million. Advanz Pharma will contribute another $45 million if the Intercept receives a pediatric orphan exclusivity extension in Europe. If Advanz Pharma seeks marketing authorization for obeticholic acid in NASH beyond the United States, Intercept could receive compensation on future net revenue of the drug.

Intercept to keep manufacturing and distributing obeticholic acid globally

Intercept shall retain the manufacture and distribution of obeticholic acid worldwide, while Advanz Pharma will be in charge of packing, distribution, and marketing throughout all markets beyond the United States.

Outside of the United States, a large percentage of Intercept employees will join Advanz Pharma. Intercept will keep hiring the remaining global staff. Also, Intercept will keep a presence in the United Kingdom to oversee its worldwide supply chain, assist its quality team, and conduct worldwide clinical trials. Durso added:

Ocaliva was given temporary authorization by the European Commission in December 2016 for  PBC treatment in adults with an adverse reaction to UDCA or as a single agent in adults who can't tolerate UDCA. It is now approved in over 40 countries around the world.