Actavis and Valeant to co-promote Zovirax and Cordran Tape

Valeant Pharmaceuticals International (TSX: VRX) has entered into an agreement, effective immediately, for generics major Actavis (NYSE: ACT) to be the exclusive marketer and distributor of an authorized generic of Valeant's antiviral Zovirax ointment (acyclovir 5%) product in the USA.  Valeant acquired North American rights to Zovirax from GlaxoSmithKline for $300 million (The Pharma Letter February 4, 2011).

The news comes two days after Mylan (Nasdaq: MYL) announced it won rUS Food and Dtug Administration approval for the first generic version of Zovirax, used to treat genital herpes. Mylan’s generic form was expected to cut into Valeant’s revenue and bottom line, but with this pact Valeant hopes to recoup at least a small portion of those losses. The drug generated about $230 million in US sales last year, according to Mylan.

Under the terms of the exclusive Zovirax ointment agreement, Valeant will supply Actavis with a generic version of the ointment product and Actavis will market and distribute the product in the USA. Actavis will record all of the net sales of the product and Valeant will receive a share of the economics. Other terms of the agreement have not been disclosed.