Azur Pharma Limited has signed a definitive agreement with Avanir Pharmaceuticals to acquire worldwide rights to the antipsychotic drug FazaClo (clozapine, USP).
The product is indicated for the management of severely ill schizophrenic patients who fail to respond adequately to standard drug treatments for schizophrenia. FazaClo is also indicated for reducing the risk of recurrent suicidal behaviour in patients with schizophrenia or schizoaffective disorders. FazaClo was approved by the FDA, and launched in the US market, in 2004. The transaction is subject to certain closing conditions and is expected to close by the end of July 2007.
Under the terms of the agreement, Azur will pay $42 million to Avanir at the close of the transaction and up to $10 million in contingent payments during 2009. In addition, Azur will pay up to $2 million in future royalties based on 3 per cent of annual net product revenues for FazaClo in excess of $17 million. Azur also assumes certain of Avanir's earn-out obligations to the original developer of the product, Alamo Pharmaceuticals, which arise upon the achievement of sales related milestones.
FazaClo generated gross revenues of $16.5 million and $10.1 million in the year ended 31 December 2006 and the five months ended 31 May 2007, respectively. The product is exhibiting strong growth and Azur expects that it will generate gross revenues of over $25 million for 2007.
Azur is acquiring the worldwide rights to FazaClo and assuming the related assets such as marketing, sales, patient registry and medical affairs infrastructure. Azur will add 73 employees with this acquisition, including 65 sales representatives and commercial support staff who market FazaClo in the US and provide field based support to psychiatrists and their patients.
Seamus Mulligan, chairman and chief executive of Azur, stated, "We are pleased to add FazaClo, an important therapeutic for the management of severely ill schizophrenic patients, to our portfolio. FazaClo is our third acquisition having previously purchased Gastrocrom and Pharmelle in January 2006 and February 2007, respectively. We have taken an important step in reaching critical mass in the US. With this transaction, we will have 90 sales representatives covering CNS and urology/women's health. We plan to add new products and development projects in these fields to further leverage our infrastructure. We will commence additional FazaClo reformulation activities with a view to enhancing the product."
Mulligan further commented, "The FazaClo team have been very successful with this product and we welcome them to Azur. We intend continuing to build on their focus and dedication so prescribers will obtain the support they require to ensure this treatment option continues to be available for appropriate patients. Our initial focus will be to launch the recently approved DuraSolv presentation of FazaClo. The new DuraSolv formulation was approved by the FDA in May 2007 and will be launched later this year."
Azur Pharma is a privately held pharmaceutical company dedicated to enhancing patients' lives by developing and marketing pharmaceutical products in specialist therapeutic areas. Azur Pharma's strategy is to identify, evaluate, selectively acquire and enhance the value of late stage development and approved pharmaceutical products.