Biogen Inc.'s stock gained 0.5% in premarket trade Tuesday, after the biotechnology company said it plans to spin off its hemophilia business, including drugs Eloctate and Alprolix, into a separate, publicly-traded company. The spinoff should be completed by the end of 2016 or early 2017, the company said, depending on a number of factors including final approval by its board of directors. Biogen said it expects the spinoff to be tax free for federal income tax purposes, since shares of the new publicly-traded company will have its shares distributed to Biogen stockholders. The new company, which doesn't yet have a name, should be headquartered in the Boston area, and its management team and board of directors will be named at a later date. Biogen said it will remain the manufacturer of Eloctate and Alprolix, which provided $640 million in combined revenue for Biogen during the year ending in late March, for three to five years. "We believe that the best way to realize the full potential of this growing and vital business is to enable it to operate independently with a management team dedicated to providing therapies to people living with hemophilia," said Biogen's chief executive officer, George Scangos, PhD.
Copyright © 2016 MarketWatch, Inc.
Continue Reading Below