Depomed Earns $10 Mln Milestone For FDA Approval Of Mallinckrodt's Xartemis XR

(RTTNews) - Depomed Inc. (DEPO) announced that the U.S. Food and Drug Administration approved Mallinckrodt plc's (MNK) New Drug Application or NDA for XARTEMIS XR (oxycodone hydrochloride and acetaminophen) Extended-Release Tablets (CII), previously known as MNK-795, for the management of acute pain severe enough to require opioid treatment and in patients for whom alternative treatment options are ineffective, not tolerated or would otherwise be inadequate.

Depomed said that the NDA approval triggers a $10 million milestone payment to Depomed under Depomed's license agreement with Mallinckrodt. Depomed will recognize the entire milestone payment in the first-quarter of 2014. Depomed will also receive high single digit royalties on net sales of XARTEMIS XR.

"We expect to receive significant recurring royalty revenue from Mallinckrodt's commercialization of XARTEMIS XR. Mallinckrodt has also licensed the Acuform delivery technology under equivalent royalty and milestone terms for its MNK-155 product candidate, which has been studied for moderate to severe acute pain. Mallinckrodt has indicated that it expects to file an NDA for MNK-155 in the second half of their 2014 fiscal year. FDA acceptance of the MNK-155 NDA would trigger a $5 million milestone payment to Depomed and approval by the FDA would trigger an additional $10 million milestone payment to Depomed." said Jim Schoeneck, President and CEO of Depomed.