DEPO COLL
Depomed Announces NUCYNTA® Commercialization Agreement with Collegium Pharmaceutical
https://globenewswire.com/news-release/2017/12/04/1220298/0/en/Depomed-Announces-NUCYNTA-Commercialization-Agreement-with-Collegium-Pharmaceutical.html
Depomed, Inc (NASDAQ:
DEPO) today announced that it has signed a definitive Commercialization Agreement (“Agreement”) with Collegium Pharmaceutical, Inc. (“Collegium”). Under the terms of the agreement, Collegium will commercialize both NUCYNTA® Extended Release and NUCYNTA® Immediate Release (“NUCYNTA”). In exchange for Collegium’s commercialization of NUCYNTA, Depomed will receive a royalty rate on all NUCYNTA revenues based on certain net sales thresholds. As long as the agreement is in force, for the first four years, Depomed will receive a minimum royalty of $135 million per year. After year four, the royalty mechanism remains the same but without a minimum. The royalty rate will be adjusted post patent expiry, which Depomed believes will not occur until at least late 2025. As a result of this transaction, Depomed will eliminate its pain salesforce and cease all brand spending on NUCYNTA, thereby reducing SG&A expenses by approximately $70 million dollars on an annual basis.