VIVUS, Inc, announced the execution of exclusive licensing agreements with Melbourne, Australia-based specialty pharmaceutical company Acrux under which VIVUS will develop and commercialize Testosterone MDTS and Estradiol MDTS in the US for treatment of low sexual desire and menopausal symptoms, respectively. Acrux's Metered-Dose Transdermal System (MDTS) technology is a patented, simple to use spray that is being developed to deliver testosterone and estradiol effectively to women when applied to the skin. This technology was pioneered by Acrux working with leading drug-delivery scientists from Monash University in Australia.

Under the terms of the agreements, VIVUS will pay to Acrux combined licensing fees of $3.0 million to be paid over the next 17 months, payments up to $4.3 million for achievement of certain clinical development milestones, product approval milestones payments of $6.0 million, and royalties on net sales in the US upon commercialization of each product.

"The MDTS technology is the next generation of transdermal drug delivery. Using this spray is as easy as taking a pill with all the safety advantages of transdermal delivery," said Leland Wilson CEO of VIVUS. "Testosterone has been used in clinical trials for treating women with low sexual desire and we now have a patient-preferred, patented delivery system. With the addition of these products, VIVUS is well-positioned with therapies in its pipeline to address women's health issues including the two most prevalent conditions related to female sexual dysfunction (FSD) -- decreased desire and arousal. These strategic agreements underscore VIVUS' commitment to developing innovative treatments for sexual dysfunction."

Acrux has conducted clinical trials for both products under INDA on file with the US FDA. Acrux is currently conducting a 200-patient Phase 2 study in Australia for Testosterone MDTS. This study is expected to be completed in early 2005. With the exception of this Phase 2 study, VIVUS will conduct all future development work for Testosterone MDTS. Current plans anticipate beginning Phase 3 clinical development in 2005. VIVUS will take Estradiol MDTS into Phase 3 clinical development in late 2004 for short-term therapy for women experiencing symptoms associated with menopause and anticipates filing a New Drug Application with the FDA in 2006.

A study published in the Journal of the American Medical Association in 1999 estimated that more than 40 per cent of women report some form of sexual dysfunction, including both organic and psychogenic causes, with the incidence increasing after menopause. Data published in the New England Journal of Medicine in 2000 suggest that testosterone is effective in treating surgically menopausal women with low sexual desire.

"We are extremely pleased to partner these two products with VIVUS. VIVUS' commitment and ability to commercialize innovative treatments addressing unmet sexual health needs make it a very attractive partner," said Igor Gonda, Acrux CEO. "We look forward to bringing these innovative therapies to large patient populations with significant unmet needs."