Nuvo Research and Covidien sign U.S. license and development agreement for Pennsaid(R) and Pennsaid Plus(R)
Tue Jun 16, 7:00 AM
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MISSISSAUGA, ON, June 16 /CNW/ - Nuvo Research Inc. (TSX: NRI.TO) a Canadian drug development company focused on the research and development of drug products delivered to and through the skin using its topical and transdermal drug delivery technologies, today announced that it has entered into a license and development agreement with Mallinckrodt Inc., a subsidiary of Covidien (NYSE: COV), a leading global provider of healthcare products, granting it exclusive rights to market and sell Pennsaid(R), and its follow-on product, Pennsaid Plus(R), in the United States.
Pennsaid and Pennsaid Plus are Nuvo's topical non-steroidal anti-inflammatory drug ("NSAID") candidates. Nuvo has been advised by the U.S. Food and Drug Administration ("FDA") that it expects to respond to Nuvo's resubmitted new drug application for Pennsaid by August 5, 2009.
Under the terms of the license and development agreement, Nuvo will receive an up-front, non-refundable payment of US$10 million. In addition, Nuvo is eligible to receive a US$15 million milestone payment on Pennsaid's approval by the FDA, which will increase to US$20 million if certain labeling criteria are agreed to by the FDA. Nuvo will receive royalties on net U.S. sales of Pennsaid and Pennsaid Plus at rates that are consistent with industry standards for products at similar stages of development. Nuvo will be eligible to receive additional escalating sales milestone payments for the products totaling up to US$100 million.
Covidien will assume responsibility for all future development activities and expenses for Pennsaid Plus, including two Phase 3 clinical trials that Covidien expects to commence in 2010. Covidien has a right to negotiate with Nuvo on an exclusive basis for a period of 90 days to expand the licensed territory to include additional unlicensed countries worldwide. Nuvo will manufacture and supply Pennsaid and Pennsaid Plus to Covidien from its existing manufacturing facility in Varennes, Québec.
Covidien is a leading global healthcare products company with revenues of nearly US$10 billion in 2008, and more than 41,000 employees in 59 countries worldwide. Its products are sold in more than 140 countries. A market study commissioned by Nuvo estimates that the market for topical NSAIDs will grow to US$2 billion annually within five years.
"Covidien is an ideal partner with the infrastructure, market reach, resources and commitment to maximize the commercial potential of Pennsaid and Pennsaid Plus," said Dan Chicoine, Chairman of Nuvo. "It is aggressively adding resources to maximize the value of the Pennsaid/Pennsaid Plus franchise and pursue its strategy of becoming a global presence in the treatment of pain."
About Pennsaid and Pennsaid Plus
