Santarus, Inc. and Depomed, Inc. announced that they have entered into a new commercialization agreement for Glumetza (metformin hydrochloride extended release tablets) under which Santarus will assume broad commercial, manufacturing and regulatory responsibilities to replace a promotion agreement that the companies entered into in July 2008. Under the new agreement, Santarus will record revenue from Glumetza sales in the US effective September 1, 2011 and over the next few months Depomed will transition most US commercial activities for Glumetza to Santarus including managed care contracting, pricing, certain manufacturing activities and distribution.

In addition, Depomed will transfer to Santarus the New Drug Application (NDA) for Glumetza and Santarus will be responsible for the product's pharmacovigilance activities in the US Depomed will have an option for expanded rights to co-promote Glumetza to physicians not called on by Santarus.

Under the terms of the new commercialization agreement, Santarus will pay Depomed royalties on net sales of 26.5 per cent in 2011, 29.5 per cent in 2012, 32.0 per cent in 2013 and 2014, and 34.5 per cent in 2015 and beyond. Santarus will pay no additional sales milestones to Depomed that were required under the prior promotion agreement. The new agreement provides for a reduced minimum spend obligation for Santarus for promotional expenses and streamlines the oversight of the brand. In addition, Santarus will reimburse Depomed for 70 per cent of its future costs in ongoing Paragraph IV litigation for Glumetza. If Depomed elects to co-promote Glumetza, Santarus will be obligated to pay a royalty of 70 per cent of the net sales attributable to prescriptions generated by Depomed's called on physicians over a pre-established baseline.

“We are pleased to expand our commercial activities for Glumetza, a product that we believe has significant potential in the type 2 diabetes market,” said Santarus president and chief executive officer Gerald T Proehl. “After promoting Glumetza for almost three years, our commercial organization is eager to manage contracting and pricing to maximize the potential for the brand. Given our focus on the Glumetza brand and the internal resources we have allocated to its promotion, it makes good business sense to transition certain manufacturing activities, distribution and ownership of the NDA for Glumetza to our organization. We also believe this agreement will result in greater financial value for both Santarus and Depomed.”

He added, “We are moving forward with new eVoucher and savings card programs for Glumetza, which we plan to introduce in the coming months. We believe these new programmes will significantly increase patient access to our products for adult patients with type 2 diabetes by reducing the out-of-pocket cost for Glumetza to a level roughly equivalent to a Tier 1 copay for patients with commercial insurance.”

Depomed president and chief executive officer Jim Schoeneck said, “This is a good deal for both companies. For Depomed, it should add meaningfully to our bottom line and should lead to further growth in revenues for Depomed as Santarus grows the franchise. We have a great deal of confidence in the Santarus team and their ability to take on expanded commercial activities for Glumetza. This transaction allows our commercial, regulatory and manufacturing teams to focus energies on the successful launch of Gralise (gabapentin), our once-daily formulation of gabapentin for the management of postherpetic neuralgia, while also providing us the option to promote Glumetza with our new sales force.”

Glumetza (metformin hydrochloride extended release tablets) is indicated as an adjunct to diet and exercise to improve glycemic control in adult patients with type 2 diabetes. It may be used concomitantly with a sulfonylurea or insulin to improve glycemic control in adults. It is available in 500 mg and 1000 mg tablets.

Lactic acidosis can occur due to metformin accumulation. The risk increases with conditions such as sepsis, dehydration, excess alcohol intake, hepatic insufficiency, renal impairment, and acute congestive heart failure.

Symptoms include malaise, myalgias, respiratory distress, increasing somnolence, and non-specific abdominal distress. Laboratory abnormalities include low pH, increased anion gap and elevated blood lactate.

If acidosis is suspected, discontinue Glumetza and hospitalize the patient immediately.

Glumetza is contraindicated in patients with renal dysfunction, known hypersensitivity to metformin HCl or metabolic acidosis, including diabetic ketoacidosis. Use of concomitant medications that affect renal function or hemodynamic change may interfere with the disposition of metformin and should be used with caution.

Hypoglycemia does not occur in patients receiving Glumetza alone but could occur with deficient caloric intake or during concomitant use with other glucose-lowering agents or ethanol. Loss of glycemic control may occur when a stabilized patient is exposed to stress.

In clinical trials, the most common side effects with Glumetza monotherapy were diarrhoea, nausea, dyspepsia, and upper abdominal pain. In a clinical trial of Glumetza combined with a sulfonylurea, the most common side effects included hypoglycemia, diarrhoea, and nausea.

Depomed, Inc. is a specialty pharmaceutical company with one approved product on the market and another recently approved product.

Santarus, Inc. is a specialty biopharmaceutical company focused on acquiring, developing and commercializing proprietary products that address the needs of patients treated by physician specialists.