The drug has been reformulated using Cosmo's proprietary multi matrix MMX technology, and could generate a multi-million Euro cash stream for the Italian firm. Ferring will make an initial €2m payment to Cosmo to gain exclusive worldwide licensing rights (excluding Japan and the US), and following market entry (scheduled for 2010) will make revenue-related milestone payments which are anticipated to reach as much as €58m over the product life. Ferring will also make double-digit royalty payments on net revenue. Budesonide itself acts as an anti-inflammatory drug and is the active ingredient in a number of treatments for asthma (such as AstraZeneca's Pulmicort), non-infectious rhinitis (AstraZeneca's Rhinocort), nasal polyposis and Crohn's Disease (AstraZeneca's Entocort). As yet, no corticosteroid treatments have been granted worldwide approval for the treatment of ulcerative colitis, despite the fact that this class of treatment is known to have a stronger effect than the first line mesalamine treatments that the majority of patients are prescribed. This reluctance to approve corticosteroids in this indication is a result of the unpleasant side effects that are associated with the normal administration of this class of drugs. Cosmo, however, has reformulated the drug in a way that should greatly reduce these side effects, opening up the possibility of a more effective treatment for sufferers of ulcerative colitis. Cosmo has used its MMX technology to create an oral dosage form that can provide targeted drug release at a specific site in the colon. Tablets are coated with pH-resistant acrylic copolymers which delay the release of the active ingredient until the tablet reaches the designated intestinal region where controlled dissolution begins. Protected from the harsh pH and enzymatic conditions of the upper digestive tract via an array of matrices and protecting layers, the active ingredient can then be released in a controlled fashion throughout the length of the colon. Cosmo's budesonide delivers the active directly to the lumen of the colon. The drug dissolution profile increases the colon-specific bioavailability and reduces pre-colonic systemic absorption - the cause of the side effects that limit the use of corticosteroids. Cosmo's objectives are not only to provide the first oral corticosteroid for ulcerative colitis, but to bring about a reduction in treatment time by 50 per cent. It has been estimated that in the five major EU countries, 20 per cent of all patients with mild to moderate ulcerative colitis will switch to Cosmo's budesonide for their treatment in acute phase. Ferring will immediately partner with Cosmo on multi-centre Phase III trials across Europe, with introduction onto the US and EU markets expected in 2010. Cosmo's first MMX-formulated product hit the market in March this year, another treatment for ulcerative colitis. Lialda/Mezavant (mesalamine) is licensed globally to Giuliani and Shire, and in its first few weeks on the US market captured 1.2 per cent of the oral mesalamine market, a figure which is expected to increase over the course of the year.