Last week, Vertex Pharmaceuticals (VRTX) announced that it would seek to sell the European rights to telaprevir, the company’s investigational HCV drug. The drug is currently partnered in Europe with J&J and any payments received from J&J would go to the rights owner.

But, according to the Financial Times, Morgan Stanley (MS), who’s handling the deal for VRTX, has been around this block before. MS bankers have worked on similar drug-based deals in the past, since 2004 and the VRTX deal will be number 18.

It seems deals like these tend to be a win-win situation because the assets stay with the company without equity dilution and it offers investors a promising return, often with double-digit coupons. Thomas Cahill, co-head of Morgan Stanley’s structured products group said this:

“We think other holders of royalties will start to avail themselves of this technology and the rationale. The products are bespoke, but we believe there are enough investors prepared to do their own homework for the deals to become more common.”

Read the full article at Financial Times.

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