Glenmark, Paul Capital sign USD 27 mn deal for derma products

Mumbai, June 5 (UNI) Glenmark Pharmaceuticals Inc (GPI) has signed a deal with an international healthcare Investment fund, Paul Capital Partners Royalty for development of 16 dermatological products by the company for the US market.

Under the terms of the arrangement, the company said Paul Royalty will invest up to USD 27 million to finance the development of 16 dermatological products by Glenmark Pharmaceuticals for the US market.

Glenmark MD and CEO Glenn Saldanha said, ''This deal marks many firsts including first time an Indian company is entering the US market with an entire portfolio of dermatology products, a unique deal structure and the first risk-sharing financing deal of its kind.'' Sharing clinical and operational risks, Mr Saldanha said, inherent in the portfolio and reducing the impact of generic R&D expenditure on the profit and loss are among the key reasons for the company to have entered into this deal. ''We have chosen Paul Royalty to partner in this risk-sharing deal for their deep experience in healthcare investment and understanding of the process evolved.'' Further, he said the company will be responsible for pre-clinical development, will manage, the clinical trial and manufacture the products. It will be responsible for filing the abbreviated new drug applications (ANDAs) and upon approval marketing the products in the US.

It will also supply active pharmaceutical ingredient (API) for some of the products. Paul Royalty will finance product development through milestone payments to GPI over the next two years. In return, Paul Royalty will receive a royalty -- quantum undisclosed -- on net sales for these products, with the percentage varying by product and performance.

The products in the portfolio currently have a total US market revenue of about USD one billion. DSP Merrill Lynch and Greenberg Traurig LLP were the company's financial and legal advisors, respectively, for the deal.

All 16 products are expected to be launched over the next five years with the first product launch occurring in 2007.

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