Biovail Corporation announced that its subsidiary, Biovail Laboratories International SRL (BLS), has entered into an agreement with Santhera Pharmaceuticals (Switzerland) Ltd, a subsidiary of Santhera Pharmaceuticals Holding AG to acquire the US and Canadian rights to develop and commercialize Santhera's JP-1730/fipamezole for the treatment of Dyskinesia in Parkinson's Disease (DPD). JP-1730/ fipamezole is a first-in-class compound that, in a recent phase-IIb study, displayed the potential to reduce levodopa-induced dyskinesia.

Bill Wells, Biovail's chief executive officer said, "This agreement with Santhera is directly on strategy and another important step in our efforts to build a sustainable product-development pipeline in specialty central nervous system disorders."

"Biovail is an emerging key player in the area of neurodegenerative disorders. With its commitment to this therapeutic area and the strong track record it has developed in a short period of time, I am confident that JP-1730/fipamezole will become a key product for the improved management of Parkinson's disease," said Klaus Schollmeier, chief executive officer of Santhera."

Under the terms of the agreement, which covers only the US and Canada, and subject to customary closing conditions, Biovail will make an upfront payment of $8 million, a further payment of $4 million upon the successful closing of Santhera's acquisition of Oy Juvantia Pharma Ltd., and will pay up to $35 million in potential development and regulatory milestones associated with the initiation of a phase-III study, regulatory submissions and approvals of JP-1730/fipamezole in DPD. The agreement also stipulates that Biovail make additional milestone payments of up to $145 million as certain sales thresholds are met. Biovail will also make royalty payments of 8 to 15 per cent on net commercial sales of JP-1730/fipamezole.

Should Biovail pursue a second indication, up to $20 million in additional success milestones would be payable to Santhera upon approval.

Biovail will be responsible for the remaining clinical development programs and costs in the US and Canada. The companies have agreed to collaborate on the development program. Santhera will have the right to use and sublicense data generated for development and commercialization purposes outside of North America. Initiation of the first phase-III study in the US is scheduled for 2011. Santhera will retain co-promotion rights in the US.

Fipamezole is an antagonist of the adrenergic alpha-2 receptor with a novel mode of action in the treatment of Dyskinesia in Parkinson's Disease.

Biovail Corporation is a specialty pharmaceutical company engaged in the formulation, clinical testing, registration, manufacture, and commercialization of pharmaceutical products.

Santhera Pharmaceuticals Holding AG is a Swiss specialty pharmaceutical company focused on the development and commercialization of small-molecule pharmaceutical products for the treatment of severe neuromuscular diseases, an area of high unmet medical need which includes many orphan indications with no current therapy.