Hospira signs licensing agreement to develop and market DURECT's POSIDUR

Jun 8 2010

Hospira, Inc. (NYSE: HSP), a global specialty pharmaceutical and medication delivery company, and DURECT Corporation, a specialty pharmaceutical company (Nasdaq: DRRX), today announced that the companies have entered into a licensing agreement to develop and market DURECT's POSIDUR™ (SABER™-bupivacaine) a long-acting version of the anesthetic bupivacaine currently in Phase III clinical trials. Hospira will co-develop the drug and would have exclusive marketing rights in the United States and Canada following regulatory approval.

Under terms of the agreement, Hospira will make an upfront payment of $27.5 million, with the potential for up to an additional $185 million in performance milestone payments based on the successful development, approval and commercialization of POSIDUR.  For the U.S. and Canada, the two companies will jointly direct and equally fund the remaining development costs, while Hospira will have exclusive commercialization rights with sole funding responsibility.  In addition, Hospira will pay DURECT a royalty on product sales.

POSIDUR is designed to provide up to 72 hours of anesthetic directly at the site of a surgical wound, with the potential to reduce post-surgical pain and allow earlier patient mobility and hospital discharge. Phase III trials are expected to be completed in 2011. Bupivacaine is a widely used generic anesthetic currently marketed by Hospira as well as other companies.

"This partnership with DURECT provides Hospira with U.S. and Canadian rights to an exciting new product that will bolster our leadership position in acute-care proprietary pharmaceuticals," said Andrew Robbins, vice president, Corporate Development and Proprietary Pharmaceuticals, Hospira. "POSIDUR is being developed to improve post-surgical recovery, which represents a good fit with our vision of advancing wellness for patients."

"This collaboration builds on the relationship we've had with Hospira for several years as our manufacturer of POSIDUR," stated James E. Brown, president and chief executive officer of DURECT Corporation. "We believe that POSIDUR has the potential to play a significant role in treating post-surgical pain, reducing the need for systemic narcotic pain relief and associated side effects, as well as costs associated with lengthy hospital stays."

From a commercial perspective, POSIDUR will be complementary with Precedex™, Hospira's proprietary sedation agent, which is currently marketed in the hospital through a dedicated acute-care sales force.