Inspire Pharmaceuticals, Inc. (NASDAQ: ISPH) announced today it has entered into an Amended and Restated License, Development and Marketing Agreement with Allergan, Inc., which revises terms related to the PROLACRIA™ (diquafosol tetrasodium ophthalmic solution) 2% development program and Inspire's right to receive revenues from Allergan based on net sales of RESTASIS® (cyclosporine ophthalmic emulsion) 0.05% and any other human ophthalmic formulations of cyclosporine owned or controlled by Allergan.
“This agreement provides clarity on the revenue stream and respective responsibilities of the parties in our ophthalmic collaboration”
"This agreement provides clarity on the revenue stream and respective responsibilities of the parties in our ophthalmic collaboration," said Adrian Adams, President and CEO of Inspire. "We have solidified the term for potential RESTASIS® and follow-on product revenues and have eliminated any financial commitment for both the continued development of PROLACRIA™ and the co-promotion of RESTASIS®. We are pleased to have now gained sole control over any future PROLACRIA™ development while retaining the right to leverage the asset as appropriate. At this time, we are not planning to proceed with clinical development of PROLACRIA™. Our strategy is to create shareholder value by focusing resources on our AZASITE® franchise and our potentially transformational denufosol tetrasodium for cystic fibrosis program."
Under the amended agreement, which now runs through December 31, 2020, Inspire is entitled to receive revenues at one global rate based on net sales of RESTASIS® and any other human ophthalmic formulation of cyclosporine owned or controlled by Allergan, with no requirement to co-promote RESTASIS®. The royalty rate for RESTASIS® in the United States remains unchanged for the remainder of 2010. The annual global rate steps down from the 2010 U.S. rate by three percentage points in 2011, a further 0.25 percentage point in 2013, and a final 0.50 percentage point in 2014, remaining at this level through the end of the term in 2020.
Under the amended agreement, Inspire now has unilateral control over any future PROLACRIA™ development and commercialization. In the event Inspire resumes the PROLACRIA™ clinical development program and receives regulatory approval for a PROLACRIA™ product in a particular country, it will have the option to offer PROLACRIA™ commercialization rights to Allergan for such country. If Inspire chooses not to offer Allergan PROLACRIA™ commercialization rights with respect to a country, Inspire will receive all the commercialization revenues related to PROLACRIA™ in such country and Inspire's rights to receive revenues from Allergan based on net sales of RESTASIS® products in such country will terminate.
Under the prior agreement, RESTASIS® royalties would have been reduced by thirty percent if the joint development committee elected to terminate the PROLACRIA™ development program and Inspire elected not to co-promote RESTASIS®. Under the prior agreement, Inspire was entitled to receive revenues based on net sales of RESTASIS® and on any other human ophthalmic formulation of cyclosporine owned by Allergan on a country-by-country basis for a term equal to the later of (i) the applicable patent term covering such product in such country, and (ii) 10 years from commercial launch of such product.
: Inspire Pharmaceuticals