In return for exclusive marketing rights covering the US and Puerto Rico, Esprit will pay Depomed a $50 million license fee, consisting of $30 million payable upfront, $10 million in 12 months, and the remaining $10 million due in 24 months.
Esprit will also pay Depomed 15% to 25% royalties on net sales of Proquin XR, based on escalating product sales. Esprit will retain right of first refusal for the sales and marketing of Proquin XR for the Canadian market.
John Spitznagel, chairman and CEO of Esprit, said: “Adding Proquin XR to our product portfolio provides an outstanding opportunity to leverage the strength of Esprit’s sales force and to realize benefits arising from product synergies with our marketing of Sanctura, a treatment for overactive bladder.”
Esprit is expected to launch Proquin XR in the US urology market in the fourth quarter 2005, followed by a subsequent launch into further markets expected within six months of the initial launch.
Following the news, Depomed’s stock jumped by over 15%.