Phosphagenics (ASX:POH) has signed a development agreement with Terumo Corporation for the TPM/Oxymorphone patch in Japan.
Phosphagenics and Terumo signed a non-binding term sheet in January this year detailing the proposed terms under which Phosphagenics would grant Terumo exclusive rights to develop, market and sell a TPM enabled Oxymorphone patch in Japan.
Both companies have subsequently worked to finalise the composition of a patch specifically focused on the Japanese market, which prefers a 1-day (24-hour) patch.
The agreement signed targets progression of a 1-day TPM enabled Oxymorphone patch into the clinic within the first 12 months followed by a formal consultation with Japan's regulator (PMDA) to determine the most efficient way to market.
Phosphagenics said it will undertake some of the activities associated with progression of the patch and will receive up to $2 million in development milestone payments through this period.
"On successful completion of the first Phase 1 study and PMDA consultation, Terumo can activate an exclusive option and progress to a full license agreement," said the company in a statement. "The terms for such an agreement, set forth in the previous non-binding term sheet, include Terumo accepting all Japanese development costs, providing additional development and sales milestones, and paying Phosphagenics single to double digit royalties on net sales in Japan."
"As part of this agreement Terumo has now formally informed Phosphagenics of its strategic decision not progress two TPM enabled patches in parallel," it added.
According to Mr Masahito Takahashi of Terumo, “This agreement marks a significant milestone in a relationship that continues to get stronger. Terumo remains enthusiastic about the potential of TPM enhanced products and continues to commit significant resources across all joint programs. This agreement is another demonstration of our growing confidence in TPM and confidence in Phosphagenics as a partner and the potential of the TPM/Oxymorphone patch for Japan.”
Phosphagenics’ CEO, Dr Ross Murdoch, said, “During the past 12 months, Phosphagenics and Terumo have worked very closely to progress multiple TPM based projects including the TPM/Oxymorphone patch. The signing of this agreement ensures that we can now rapidly progress the patch into the clinic and onto the PMDA. Success with this patch has the potential to provide Phosphagenics tens of millions of dollars from milestones and royalties as well as valuable data to help us partner and market TPM products across all markets.”