TORONTO (Reuters) – Canada’s Valeant Pharmaceuticals International (VRX.TO: Quote) and U.S. company Kadmon Pharmaceuticals said on Monday they have signed two deals to partner on hepatitis C drugs as Valeant moves to end development of antiviral drugs but seeks to bolster its offering of already commercialized drugs.
The first agreement gives Kadmon exclusive global rights with the exception of Japan to develop and commercialize taribavirin for an upfront payment of $5 million and royalty payments of between 8 and 12 percent. Taribavirin was being developed by Valeant to treat chronic hepatitis.
Under the terms of a second deal, Valeant paid $7.5 million to Kadmon for exclusive commercial rights to all dosage forms of the existing hepatitis C drug, ribavirin, in six central European countries, to be marketed as part of Valeant’s branded generics line.
Taribavirin has been shown to be as effective as ribavirin but with significantly fewer anemia-related side-effects, Valeant said.
Valeant Chief Executive Michael Pearson said participating in product development in the hepatitis C market no longer fits his company’s corporate strategy.
Mississauga, Ontario-based Valeant, known as Biovail before it acquired U.S.-based Valeant this year, has revamped its business to focus on central nervous system disorders and dermatology.
It continues to maintain a portfolio of generic drugs, which make up roughly 35 percent of its product line and are sold mainly in the Central European and Latin American markets.
New York-based Kadmon is headed by former ImClone Systems Chief Executive Sam Waksal, whose insider trading scam sent him and television celebrity Martha Stewart to prison. Last Monday, Waksal announced the acquisition of privately held Three Rivers Pharmaceuticals, which will form the backbone of his new biotech company.
Valeant shares were up 12 Canadian cents, or 0.43 percent, at C$28.34 on Monday morning on the Toronto Stock Exchange. In New York, its shares were rose 31 cents, or 1.12 percent, to C$27.92.
(Reporting by Solarina Ho; editing by Peter Galloway)