LONDON—In a deal that could be worth more than $800 million, GlaxoSmithKline is teaming up with California-based Valeant Pharmaceuticals International to develop and market Retigabine, a first-in-class neuronal potassium channel opener for treatment of adult epilepsy patients with refractory partial onset seizures.
Under terms of the agreement, GlaxoSmithKline will make an upfront payment of $125 million to Valeant and will pay up to $545 million as Retigabine reaches certain development and marketing milestones.
The move is the latest in a string of deals finalized by GSK with smaller partners, designed to boost its pipeline of experimental medicines.
"We have always said that we don't have a monopoly on good ideas or good science and that we must look outside to access innovation and expertise, as well as developing our in-house capabilities," says Melinda Stubbee, a GSK spokeswoman. "Sometimes we use partnerships to access new technology which we do not have, or to bring into our portfolio new potential compounds. We may also use partnership to experiment with or test new concepts ahead of a major investment."
The recent announcement comes as Valeant is becoming increasingly active in the market. In August, the company sold certain Western and Eastern European operations to Swedish pharma Meda for $392 million while simultaneously inking a distribution agreement with Meda for other worldwide markets.
J. Michael Pearson, chairman and CEO of Valeant, says the company tapped GSK as a collaborator because they showed a strong commitment to the continued development of Retigabine.
"GSK's development expertise and strong commercial infrastructure will be critical to maximizing the worldwide potential of Retigabine," says Pearson. "We believe this collaboration will strengthen our ability to bring this medicine to patients suffering from epilepsy and a variety of other conditions."
While GSK already markets an epilepsy drug, Lamictal, which in 2007 reported sales of $2 billion, the agreement will enhance the company's pipeline.
According to Laurie Little, vice president of investor relations at Valeant, Retigabine offers GSK another tool to add to its arsenal of epilepsy drugs.
But Lamictal and other epilepsy drugs are nearing the end of patent life, Little says, adding that since many epilepsy treatments are used side by side, Retigabine would not be in outright competition with GSK's Lamictal.
GSK was a good partner for Valeant, Pearson adds, because it already had a worldwide presence in the epilepsy space and a sales force with established relationships with neurologists. Plus, GSK brought additional scientific expertise to the table.
Valeant will co-commercialize the drug with GlaxoSmithKline and share up to 50 percent of profits within the U.S., Canada, Australia, New Zealand and Puerto Rico, and recieve up to a 20 percent royalty outside the regions. The two companies will jointly fund all global research and development expenses for Retigabine, and GSK will completely fund the development of VRX698 and the other back-up compounds from the potassium channel opener discovery program.
The two companies plan to file the drug with regulators in the U.S. and Europe by early 2009.
The deal also presents GSK with the opportunity to work with Valeant to develop medicines like Retigabine for the medical community, according to Steve Stefano, senior vice president of GSK's U.S. NeuroHealth Division.
"There is a significant need for novel anti-epileptic drugs, as almost one-third of patients with epilepsy continue to experience seizures despite treatment with currently available medications," says Stefano. "We believe that Retigabine could potentially play a significant role in improving the management of epilepsy." DDN
Under terms of the agreement, GlaxoSmithKline will make an upfront payment of $125 million to Valeant and will pay up to $545 million as Retigabine reaches certain development and marketing milestones.
The move is the latest in a string of deals finalized by GSK with smaller partners, designed to boost its pipeline of experimental medicines.
"We have always said that we don't have a monopoly on good ideas or good science and that we must look outside to access innovation and expertise, as well as developing our in-house capabilities," says Melinda Stubbee, a GSK spokeswoman. "Sometimes we use partnerships to access new technology which we do not have, or to bring into our portfolio new potential compounds. We may also use partnership to experiment with or test new concepts ahead of a major investment."
The recent announcement comes as Valeant is becoming increasingly active in the market. In August, the company sold certain Western and Eastern European operations to Swedish pharma Meda for $392 million while simultaneously inking a distribution agreement with Meda for other worldwide markets.
J. Michael Pearson, chairman and CEO of Valeant, says the company tapped GSK as a collaborator because they showed a strong commitment to the continued development of Retigabine.
"GSK's development expertise and strong commercial infrastructure will be critical to maximizing the worldwide potential of Retigabine," says Pearson. "We believe this collaboration will strengthen our ability to bring this medicine to patients suffering from epilepsy and a variety of other conditions."
While GSK already markets an epilepsy drug, Lamictal, which in 2007 reported sales of $2 billion, the agreement will enhance the company's pipeline.
According to Laurie Little, vice president of investor relations at Valeant, Retigabine offers GSK another tool to add to its arsenal of epilepsy drugs.
But Lamictal and other epilepsy drugs are nearing the end of patent life, Little says, adding that since many epilepsy treatments are used side by side, Retigabine would not be in outright competition with GSK's Lamictal.
GSK was a good partner for Valeant, Pearson adds, because it already had a worldwide presence in the epilepsy space and a sales force with established relationships with neurologists. Plus, GSK brought additional scientific expertise to the table.
Valeant will co-commercialize the drug with GlaxoSmithKline and share up to 50 percent of profits within the U.S., Canada, Australia, New Zealand and Puerto Rico, and recieve up to a 20 percent royalty outside the regions. The two companies will jointly fund all global research and development expenses for Retigabine, and GSK will completely fund the development of VRX698 and the other back-up compounds from the potassium channel opener discovery program.
The two companies plan to file the drug with regulators in the U.S. and Europe by early 2009.
The deal also presents GSK with the opportunity to work with Valeant to develop medicines like Retigabine for the medical community, according to Steve Stefano, senior vice president of GSK's U.S. NeuroHealth Division.
"There is a significant need for novel anti-epileptic drugs, as almost one-third of patients with epilepsy continue to experience seizures despite treatment with currently available medications," says Stefano. "We believe that Retigabine could potentially play a significant role in improving the management of epilepsy." DDN
