Depomed, King Pharmaceuticals considering agreement for Glumetza combination product

By Jennifer Lanning Drey

Eugene, Ore., Sept. 21 - Depomed Inc. is in discussions with King Pharmaceuticals Inc. regarding the possibility of an agreement for a Glumetza combination product, John Fara, Depomed's president and chief executive officer, said Thursday at the Oppenheimer diabetes conference.

Under their current agreement for Glumetza, the two companies have six months to structure a further agreement for a combination product, he said.

Glumetza (metformin hydrochloride extended-release tablets) is a novel form of metformin that was launched in the United States this month. Depomed and King currently share the drug's profits and marketing costs, while King bears all sales costs.

Depomed is also in discussions with other companies that may be interested in licensing Glumetza in markets outside the United States, Fara said. Glumetza is approved in Canada and Korea, and Depomed receives royalties from its partners in each of those countries.

Although still developing new drugs, the addition of the new Glumetza royalties is another step Depomed has taken toward becoming a "revenue story," Fara said Thursday.

Depomed also has a $50 million license agreement with Esprit Pharma for the marketing of ProQuin XR, under which Depomed is scheduled to receive a $10 million licensing fee payment before the end of the year.

In addition, Depomed expects to receive another $3 million from Esprit for minimum royalties this year and $15 million in licensing fees and royalties in 2007, Fara said.

"From that standpoint, we're in reasonably good shape financially with revenues starting to come in now," he said.

Within the next 12 months, the company also plans to complete enrollment in its phase 3 Gabapentin GR trial and report data from the trial in 2007, Fara said.

Located in Menlo Park, Calif., Depomed is a specialty pharmaceutical company using its AcuForm drug delivery technology to develop novel oral products and extended release formulations of existing oral drugs.

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