Vivus hits menopause milestone
payment following last month's decision by US regulators to approve
a novel spray-on estrogen treatment for menopausal women.
The US Food and Drug Administration (FDA) approval of EvaMist (estradiol) at the end of July prompted the payment by KV Pharmaceutical, who bought the rights to the hormone product earlier this year. EvaMist is indicated for the treatment of hot flashes in menopausal women and is the first estradiol spray to be approved by the FDA. The product was developed by Australian specialist drug delivery firm, Acrux, and is billed as a multi-million dollar product that promises significant advantages over traditional estrogen therapies. The hand-held spray device delivers a fine of estradiol mist to the skin of the forearm, where it is absorbed and released into the bloodstream over 24 hours providing an convenient, once-daily dosing regime. The patented fast-drying formulation is made up of the drug, penetration enhancers and a volatile solvent, and results in an 'invisible patch' on the arm of the user. EvaMist has been estimated to hit peak annual sales of around $125m when it reaches the US market. Acrux originally licensed the EvaMist product to Vivus for the US market in 2004, but in March this year Vivus agreed to sell its exclusive rights and assets related to the product to KV Pharmaceutical. Vivus received $10m upon the closing of the deal, with the FDA approval triggering the following $140m payment. In addition to this, Vivus is eligible to receive two more one-off payments based on sales milestones for EvaMist. The first, a $10m payment, will be due when the product hits $100m in net annual sales, and a second $20m payment will come in when that figure reaches $200m. Through its acquisition of Vivus' rights to EvaMist, KV is also responsible for royalty payments to Acrux, with a milestone payment of $30m due within 30 days of the FDA approval. The windfall has proved a significant boost to Vivus, setting the company up in "the strongest financial position in [its] history." The firm believes that with the proceeds of the milestone payment it will be able to see through Phase III trials of its obesity drug Qnexa, as well as potentially expanding its development pipeline. However, despite the hefty payment to Vivus, KV also has high hopes for its EvaMist-related finances. Part of the company's subsidiary Ther-Rx' women's health line, the company believes EvaMist could be one of the business's largest products in terms of revenue. The product is due to be launched during the second half of 2008.
