Auxilium Pharmaceuticals, Inc. (Nasdaq: AUXL), a specialty biopharmaceutical company, announced today the signing of an agreement with VIVUS, Inc. (Nasdaq: VVUS) providing Auxilium with the exclusive right to market VIVUS's product, STENDRA (avanafil), in the United States and Canada. The parties also simultaneously signed a Commercial Supply Agreement pursuant to which VIVUS will be initially responsible for the manufacture and supply of STENDRA to Auxilium.
STENDRA is an oral therapy approved by the U.S. Food and Drug Administration (FDA) for the treatment of erectile dysfunction (ED).
Under the license, Auxilium will pay VIVUS a one-time license fee of $30 million. Auxilium may make a $15 million regulatory milestone payment to VIVUS if the FDA approves the STENDRA label to reflect a 15 minute or less onset of action efficacy claim and up to $255 million in potential milestone payments based on the achievement of certain sales targets. VIVUS will also receive royalties on product sales.
It is estimated that more than 50 percent of men over 40 years of age experience some degree of ED. Prevalence of the condition increases with age and can be caused by a variety of factors, including medications (anti-hypertensives, histamine receptor antagonists); lifestyle (tobacco, alcohol use); diseases (diabetes, cardiovascular conditions, prostate cancer); prostatectomy, and spinal cord injuries. The market opportunity for ED medical treatments continues to grow, with U.S. sales exceeding $2.9 billion in 2012. About one half of men being treated with currently available PDE5 inhibitors are dissatisfied with the results of that treatment and tend to switch among the products in pursuit of better efficacy or less side effects.
Auxilium expects to begin its commercial launch of STENDRA by the end of 2013, first with shipments of STENDRA in December 2013, followed by promotional activities in early January 2014 by its PRIMERA sales force, which consists of 150 representatives currently devoted to strategic targeting of urologists, endocrinologists, and certain high prescribing primary care physicians. The Company also plans to leverage digital media to reach a broader audience online. Auxilium believes that the transaction will be accretive in 2015.
"We believe STENDRA complements our current portfolio of testosterone replacement therapy and ED products, further broadening our men's health care franchise in a very large market segment consisting of patients that tend to switch among products," said Adrian Adams, Chief Executive Officer and President of Auxilium. "We believe the unique features of STENDRA, including its dosing interval (30 minutes prior to sexual activity), ability to take with or without food, modest alcohol consumption requirements and a favorable side effect profile make it an exciting entrant into the category."
"Auxilium is the ideal partner for STENDRA, with an established sales force and excellent relationships with physicians responsible for men's health care," stated Timothy E Morris, Senior Vice President, Finance and Global Commercial Development, Chief Financial Officer for VIVUS, Inc. "We look forward to working with Auxilium as they prepare for launch later this year."
VIVUS will retain commercial rights to STENDRA outside the U.S. and Canada and will continue to be responsible for the product's development and regulatory approval in the U.S. to support a potential label amendment for a 15 minute or less onset of action efficacy claim, if approved by the FDA.
Auxilium Pharmaceuticals, Inc.