The agreement replaces a promotion agreement that the companies signed in July 2008.
The tie up allows Santarus to record revenue from Glumetza sales in the US effective 1 September 2011.
Under the agreement, Depomed is responsible to transfer most US commercial activities for Glumetza to Santarus including managed care contracting, pricing, certain manufacturing activities and distribution.
As a part of the deal, Depomed will transfer the new drug application (NDA) for Glumetza to Santarus and Santarus will be responsible for the product’s pharmacovigilance activities in the US.
As per the terms of the contract, Depomed is entitled to get royalties on sales of 26.5% in 2011, 29.5% in 2012, 32.0% in 2013 and 2014, and 34.5% in 2015 and beyond from Santarus.
Santarus is responsible to pay no additional sales milestones to Depomed that were required under the prior promotion agreement.
The new agreement provides for a reduced minimum spend obligation for Santarus for promotional expenses and streamlines the oversight of the brand.
Under the pact, if Depomed elects to co-promote Glumetza, Santarus will be obligated to pay a royalty of 70% of the net sales attributable to prescriptions generated by Depomed’s called on physicians over a pre-established baseline.
Santarus president and CEO Gerald Proehl said they are moving forward with new eVoucher and savings card programs for Glumetza, which we plan to introduce in the coming months.
"We believe these new programs will significantly increase patient access to our products for adult patients with type 2 diabetes by reducing the out-of-pocket cost for Glumetza to a level roughly equivalent to a Tier 1 copay for patients with commercial insurance," Proehl said.