AGI Thera signs $19M deal with Axcan on omeprazole

Ireland's AGI Therapeutics, a speciality company focused on gastrointestinal drug products, has entered into an agreement with USA-based Axcan Pharma for North American rights to AGI's delayed/controlled-release omeprazole formulation, AGI-010. Axcan, a marketer of products for gastrointestinal diseases and disorders in North America and Europe, posted revenues of over $250.0 million in 2005.

Under the terms of the deal, Axcan has been granted exclusive marketing rights to AGI-010 in the USA and Canada in return for an initial license fee of $1.5 million, further payments of $17.5 million on the achievement of specified milestones and royalties on sales. The parties will be jointly responsible for and share certain development costs of AGI-010 up to and including its regulatory approval in the USA. Axcan will be responsible for commercializing AGI-010 in the US and Canadian markets, while AGI will have an option to co-promote the product in the former. Axcan has been granted an option to license AGI-010 for markets outside North America and additional milestone payments could become payable to AGI in the event that the US firm exercises this.

In addition to this accord, Axcan may elect to license rights from AGI to develop other controlled-release PPI products using its CHRONAB technology and intellectual property under a similar commercial structure.