Apricus, Takeda Ink Marketing Deal (ABT) (APRI) (NVS) (TKPYY) (WCRX)

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Apricus Biosciences, Inc. (APRI) and Takeda Pharmaceuticals (TKPYY) recently signed an exclusive licensing agreement to market Apricus’ Vitaros in the UK. The drug is indicated for the treatment of erectile dysfunction.

Per the terms of the deal, Takeda will make an upfront payment (details of which were not revealed) in addition to milestone payments of up to €35 million to NexMed, a wholly owned subsidiary of Apricus. As per IMS Health, the erectile dysfunction market in the UK was about €202 million in 2011.

We note that Vitaros is already approved in Canada. Moreover, the European Medicines Agency accepted the marketing authorization application for Vitaros in mid 2011. The company expects the drug to be approved in the EU in 2013.

Apricus has several agreements for Vitaros. The company has a marketing agreement with Abbott Laboratories (ABT) in Canada. In Germany, Apricus has a partnership agreement with Novartis AG’s (NVS) Sandoz for Vitaros. Apart from these Apricus has agreements with Warner Chilcott plc (WCRX), Bracco SpA, Neopharm Group, Elis Pharmaceuticals and Global Harvest Pharmaceuticals for the drug in the US, Italy, Israel, Middle-East and Australia/New Zealand, respectively. The company also has a clinical supply agreement with Warner Chilcott UK Limited for Vitaros.

Apricus’ other marketed drugs include Totect (extravasation from intravenous anthracycline chemotherapy), Granisol (nausea and vomiting associated with radiation and chemotherapy), NitroMist (angina pectoris) and Aquoral (management of dry mouth).

Our Recommendation

We currently have a Neutral recommendation on Apricus. The stock carries a Zacks #3 Rank (Hold rating) in the short run.

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