RedHill Biopharma Ltd., a specialty biopharmaceutical company, has entered into a binding term sheet with Cosmo Pharmaceuticals N.V. for an exclusive licensing and manufacturing agreement for multiple products. The transaction is expected to close in the coming weeks.
 
Pursuant to the agreement, the companies will co-develop a novel next-generation therapy for the eradication of H. pylori infection. Cosmo is to receive the exclusive European rights to the new drug and will pay RedHill $7 million upon signing of the license agreement and an additional $2 million upon approval in Europe, and 30% royalties. The companies plan to jointly execute clinical trials pursuing simultaneous regulatory approvals in the U.S. and Europe, with a cost split 70% RedHill and 30% Cosmo.
 
Cosmo will become the exclusive worldwide manufacturer for the novel next-generation therapy for the eradication of H. pylori infection, Movantik (naloxegol)¹, which RedHill recently acquired from AstraZeneca, and RHB-204 for pulmonary nontuberculous mycobacteria (NTM) infections. Cosmo will be paid €5.5 million ($6.5 million) for tech transfer, formulation and development work with respect of these products.
 
Additionally, Cosmo will finance the planned pivotal Phase 3 clinical study with RHB-204, which recently received FDA clearance to proceed, with a payment of $5 million upon signing of the agreement and an additional $7 million in two milestone payments. Cosmo will be entitled to 15% royalty payments.
 
Dror Ben-Asher, RedHill’s CEO, said, “We are very pleased to expand our strategic partnership with Cosmo Pharmaceuticals. This will accelerate the planned pivotal Phase 3 study with RHB-204 in pulmonary NTM infections and the development of a next-generation H. pylori treatment. Importantly, Cosmo has a proven track record of formulating, developing and manufacturing novel therapies for multiple countries thus ensuring high quality supply.”
 
“We are happy we have found new ways to expand our relationship with our partner RedHill and now we are eager to start working on these multiple opportunities for the benefit of both companies,” commented Alessandro Della Chà, Cosmo’s CEO. “With these deals we will simultaneously develop a new next-generation product for H. pylori eradication, expand our manufacturing franchise and help RedHill accelerate the clinical development of RHB-204.”