Daiichi Sankyo will co-commercialize AstraZeneca’s Movantik™ (naloxegol) in the U.S., the companies said today, in an up-to-$825 million deal signed less than a month before the planned launch of the opioid-induced constipation (OIC) treatment for adults with chronic noncancer pain.

The once-daily oral peripherally acting mu-opioid receptor antagonist (PAMORA) medication—the first in its class approved by the FDA last year—is designed to block the binding of opioids to opioid receptors in tissues such as the gastrointestinal tract. Naloxegol was approved in September 2014 as a Schedule II controlled substance, but de-scheduled by the U.S. Drug Enforcement Administration in January 2015.

“Movantik represents an opportunity to help patients manage one of the most common conditions arising from widely used pain medications, as well as an opportunity to continue to build the Daiichi Sankyo US portfolio of medicines in this therapeutic area,” Ken Keller, president, US commercial, Daiichi Sankyo, said in a statement.

Added Paul Hudson, president of AstraZeneca US and evp, North America: “Our agreement reflects our evolving business model by creating value from our portfolio through externalisation activity. Together, we will grow the potential of this important treatment, while we retain our significant interest in the long-term commercial success of Movantik in our largest market.”

AstraZeneca and Daiichi Sankyo face competition in OIC from Salix Pharmaceuticals. In September 2014, Salix added the indication of OIC in adults with chronic noncancer pain to its marketed injectable drug Relistor® (methylnaltrexone bromide), also indicated for OIC in patients with advanced illness who are receiving palliative care. Salix is being acquired by Valeant Pharmaceuticals International for $11.2 billion.

Cubist Pharmaceuticals, now a subsidiary of Merck & Co. following its $9.5 billion acquisition by the pharma giant, is in Phase III development of bevenopran (MK-2402) for OIC in patients with chronic noncancer pain. Bevenopran is a small-molecule, peripherally-acting mu-opioid receptor antagonist intended to block the adverse effects of opioid analgesics on the gastrointenstinal (GI) tract without affecting analgesia.

In return for its Movantik rights, Daiichi Sankyo agreed to pay AstraZeneca $200 million upfront, plus up to $625 million in subsequent sales-related payments. AstraZeneca agreed to oversee manufacturing, book all sales, and make sales-related commission payments to Daiichi Sankyo. Both companies will have joint responsibility for commercial activities.

AstraZeneca said the deal would have no effect on its 2015 financial guidance. The pharma giant told investors last month that it expected sales revenue to decline by a mid-single-digit percentage at constant exchange rates (CER), assuming the imminent launch of a generic version of Nexium in the U.S., while “core” earnings per share excluding one-time items was expected to increase by a low-single-digit percentage at CER.

AstraZeneca co-developed Movantik with Nektar Therapeutics using Nektar's oral small molecule polymer conjugate technology. The companies developed Movantik as part of a worldwide collaboration and licensing agreement announced in 2009.

Under that deal, Nektar received $125 million upfront for Movantik (then called NKTR-118) and NKTR-119, a preclinical-phase fixed-dose combination product including naloxegol that, according to Nektar, is being developed as an analgesic for pain. For Movantik, the 2009 deal also called for Nektar to receive up to $235 million tied to achieving regulatory milestones; tiered sales milestone payments of up to $375 million “if the product achieves considerable levels of commercial success”; and double-digit royalty payments on worldwide net sales.

Since 2009, Nektar has won $130 million in milestone payments from AstraZeneca tied to Movantik. In its 10-K annual filing with the U.S. Securities and Exchange Commission, Nektar said it received $35 million following FDA approval of Movantik, on top of $70 million in 2013 upon FDA acceptance for review of the drug, and another $25 million upon European Medicines Agency (EMA) acceptance for review.

Under the name Moventig®, naloxegol won marketing authorization from the European Commission for OIC in adults who have had an inadequate response to laxative(s). The commission’s approval applies to all 28 European Union (EU) member countries plus Iceland and Norway.

Nektar said it is due to receive the remaining $140 million of development milestone payments are due upon the commercial launches of Movantik in the U.S. ($100 million) and in the EU ($40 million).

In addition to the $375 million in sales milestones for Movantik, Nektar added, it is also entitled to double-digit royalty payments for both Movantik and NKTR-119 starting at 20% of net sales in the U.S. and 18% of net sales in the EU and rest-of-world, varying by country of sale and level of annual net sales.

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