Agreement covering Phase III compound calls for $110 million in other payments.

Laboratorios Almirall is paying Ironwood Pharmaceuticals $40 million up front for European rights to a late-stage drug for gastrointestinal conditions. Linaclotide is in Phase III testing as a treatment of irritable bowel syndrome with constipation (IBS-C) and chronic constipation (CC).

Besides the initial $40 million payment, Ironwood will receive $15 million in the near term. Precommercial licensing fees and milestone payments could reach $95 million. Additionally, Almirall will pay escalating royalties on linaclotide sales.

Issued composition of matter patents for linaclotide in the U.S. and Europe reportedly provide protection beyond 2024. Almirall will be responsible for regulatory approval, commercialization, and all other expenses for the European market. Ironwood retains all rights to linaclotide outside of North America and Europe.

This agreement is part of Ironwood’s strategy to develop and market its products in the U.S. while forming partnerships in other territories. Ironwood is co-developing linaclotide in the U.S. with Forest Laboratories. The deal inked in September 2007 also calls for co-promotion.

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