Biovail Corporation has acquired Prestwick Pharmaceuticals, Inc., a privately held, US-based pharmaceutical company that holds the Canadian and US licensing rights to Xenazine (tetrabenazine tablets).

Xenazine was recently approved by the United States Food and Drug Administration (FDA) for the treatment of chorea associated with Huntington's disease. Xenazine was granted Orphan Drug designation by the FDA, which provides the product with seven years of market exclusivity in the United States.

Prestwick recently entered into an exclusive agreement with Ovation Pharmaceuticals, Inc., a leading US-based specialty biopharmaceutical company, to commercialize Xenazine in the US The product's commercial launch is anticipated late-2008.

"We are delighted to have acquired Prestwick, and with it, an interest in Xenazine - the first and only FDA-approved treatment for any symptom of Huntington's disease," said Biovail chief executive officer Bill Wells. "The transaction meets all of our acquisition criteria, and represents Biovail's first commercial exposure to specialty markets in central nervous system, or CNS disorders. The acquisition is another important step in the implementation of our New Strategic Focus."

Under the terms of the agreement, Biovail has paid $100 million to acquire 100 per cent of Prestwick Pharmaceuticals, Inc. and related license rights. Beyond Xenazine, the acquisition also provides Biovail with other early-stage products, including Lisuride Sub Q (advanced Parkinson's disease), Lisuride Patch (Parkinson's disease) and D-Serine (Schizophrenia).

Biovail will commercialize tetrabenazine tablets in Canada (marketed under the Nitoman brand name) through the Biovail Pharmaceuticals Canada sales force. Biovail will pay a variable supply price that ranges from 50 per cent to 67 per cent of net sales to Cambridge Laboratories (Ireland) Ltd., the worldwide license holder of tetrabenazine. In addition, Biovail holds an option to develop future related products with Ovation for the US market in conjunction with Cambridge.

The transaction is expected to be accretive to both earnings per share and cash flows in 2009.

Xenazine was approved by the FDA on August 15, 2008 for the treatment of chorea associated with Huntington's disease, based on the results of a double-blind, placebo-controlled, Phase 3 study that found that Xenazine significantly reduced patients' chorea burden, improved global outcome scores, and was generally safe and well tolerated. Additional post-marketing preclinical studies further elucidating the safety profile of the product will be conducted. Xenazine has been available in Europe for more than 30 years and in Canada since 1996.

Xenazine is indicated for the treatment of chorea associated with Huntington's disease. Xenazine is a highly selective and reversible centrally-acting dopamine depleting drug that works by inhibiting a molecule known as vesicular monoamine transporter 2 (VMAT2).