MORRISVILLE, N.C.–(BUSINESS WIRE)— September 5, 2007 — BioDelivery Sciences International, Inc. (Nasdaq: BDSI) has entered into an exclusive and perpetual license and related supply agreement with Meda for the U.S., Canadian and Mexican commercialization rights to BDSI’s flagship BEMATM Fentanyl product for the treatment of “breakthrough” cancer pain. Under this agreement, Meda will be responsible for the marketing and distribution of BEMA Fentanyl in the U.S., whose launch is anticipated in late 2008. In addition, Meda will be responsible for the management of the post-NDA approval clinical development program.
Financial Aspects of the Partnership:
• 1st milestone: $30 million upon closing which is contingent upon antitrust approval by the Federal Trade Commission, which typically occurs within 30 days of filing.
• 2nd milestone: $30 million upon receipt of FDA approval, which is anticipated in late 2008.
• Royalty: BDSI to receive a significant double digit royalty on net sales. Guaranteed minimum annual royalties, based on low sales, exist during the first 7 years.
• Sales milestones: A total of $30 million payable at: o $10 million when annualized sales exceeds $75 million o $10 million when annualized sales exceeds $125 million o $10 million when annualized sales exceeds $175 million
• A gross margin above 70% is secured for Meda. BEMA Fentanyl consists of a small, dissolvable, polymer disc, formulated with the opioid narcotic fentanyl, for application to the buccal (inner lining of cheek) membranes.
BEMA Fentanyl has shown in clinical studies important patient advantages compared to competing products, especially fewer side effects. According to published results, the two currently largest competing fentanyl products in the U.S. with the same indication had combined sales of nearly $700 million in 2006 and grew by approximately 60% versus 2005.
Sales, marketing, and clinical studies, post-approval, to support competitive claims and expanded indications will be the responsibility of Meda. Meda and BDSI will also collaborate on expanding the indications for BEMA Fentanyl, which could increase fourfold the market potential. Meda will fund this development, and will also get a right of first refusal on the commercialization rights to future development projects based on BEMA Fentanyl.
Meda and BDSI started their collaboration in 2006 with BEMA Fentanyl for all the European markets. In July this year, Meda announced the acquisition of the U.S. specialty pharma company MedPointe Inc, an acquisition which immediately gave access to a strong platform in the US with about 500 employees within marketing and sales. Through this acquisition and Meda’s rapid development in Europe, Meda’s annual turnover has increased from around $30 million in 2002 to now approaching $1.4 billion (including MedPointe).
“This is a landmark event for BDSI, and based on our standing relationship with Meda in Europe, we believe Meda is going to be a terrific marketing partner for BEMA Fentanyl here in the U.S.” said Dr. Mark A. Sirgo, BDSI’s President and CEO. “Meda already knows BDSI and the product they will be selling here in the U.S. When they recently entered the U.S. marketplace by purchasing MedPointe, they actively pursued the U.S. BEMA Fentanyl opportunity with us given the natural strategic fit. We believe Meda provides BDSI a commercial partner with global reach and abundant resources to support our lead product. Importantly, this transaction, along with the anticipated submission of our BEMA Fentanyl NDA, will allow us to achieve BDSI’s highest priorities for 2007. We could not be more pleased.”
Anders Lonner, CEO of Meda, stated “It is optimal timing for us to acquire the BEMA Fentanyl rights so soon after the acquisition of our U.S. platform MedPointe. BEMA Fentanyl represents a huge opportunity for us in the U.S. Our ambition with this product within the breakthrough cancer pain indication is to reach well over $200 million in yearly sales. Our U.S. marketing organization has good experience in the pain area and is well acquainted with the target group. Pain is a priority therapy area and with this deal we now add a significant potential for Meda in the U.S. market.”

http://www.bdsinternational.com/news/documents/09-05-07BDSIMedaFINAL.pdf