Deal covers cancer pain drug and calls for $29 million in upfront and milestone fees from ProStrakan.

Orexo reports that Endo Pharmaceuticals, its partner in North America for cancer pain treatment Rapinyl, has returned all rights related to the drug. Orexo has now signed on ProStrakan, which already has the European license to the therapy.

Under the terms of the new agreement with Orexo covering North America, ProStrakan will commit to upfront as well as regulatory and sales milestone payments totaling $29 million, including a $2 million signing fee.

Endo will finalize and finance the current Phase III studies of Rapinyl, expected to end in December, according to Orexo. Endo has reportedly already invested approximately $40 million in the development of Rapinyl. Orexo says that it has received an additional $26.9 million in licensing payments from the firm.

In connection with the extended deal between Orexo and ProStrakan, the terms of the European agreement have changed. The approval milestones for the five biggest markets in Europe will change from €5 million to $5 million. Royalties for Europe will increase in the 7% to 9% range, and the royalty rate for North America will also increase by the same amount.

Rapinyl has already received a positive opinion from the Committee for Medicinal Products for Human Use of the EMEA. The companies expect to launch Rapinyl, branded as Abstral®, in Sweden in the third quarter with further EU launches taking place from the end of 2008.

In the U.S., ProStrakan is getting ready for an FDA approval by establishing a U.S. head office and management team. The firm is currently recruiting 67 employees for a sales force in association with NovaQuest.

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