The two drugs are prescribed by doctors to help reduce the toxic effects of chemotherapy and radiation.
Clinigen and Cumberland entered into a strategic partnership back in 2015, and the latter was subsequently awarded the exclusive rights to market and distribute Ethyol and Totect in the US.
But Clinigen has been looking to grow its presence in the higher-value US market, and last month it snapped up the US rights to cancer drug Proleukin from Novartis.
The AIM company said today’s deal was the “next step” in this strategy, and means it now has direct control of all three of its oncology drugs currently available in the US.
Clinigen wants a bigger slice of American pie
“Proleukin acted as a catalyst to create our own Commercial Medicines infrastructure in the US. Taking back direct control of Ethyol and Totect was the next part of this strategy,” said chief executive Shaun Chilton.
“To head up the US commercial team, we have recently announced the hiring of Jim Meyer who has significant experience in the North American oncology sector and will help drive our US Commercial Medicines strategy.”
He added: “Cumberland's team has done a substantial amount of work during the strategic alliance to reintroduce Ethyol and Totect into the US. We have worked well with the Cumberland team and expect the transition to be a relatively smooth one.”
Transition to complete in Q4
As part of the agreement, Cumberland will continue to support the products in the US under the existing license agreements until the end of the transition period, which is expected to last until the fourth quarter of 2019.
Clinigen will then assume responsibility for all commercial activities for the products, including distribution and medical support in the US.
It expects to begin to recognise the total benefit of in-market product sales next year (FY21), the first full year post transition of commercial rights, with a limited financial impact on reported revenues and profits during the current financial year.
In a note to clients, analysts at ‘house’ broker Peel Hunt commented: “This transition was expected since Clinigen acquired marketing infrastructure with the US rights to Proleukin earlier this year, and had previously suggested it would look to take over responsibility for the other components of the Commercial Medicines marketing activity in the US.”
Peel Hunt reiterated a ‘buy’ rating and 1,390p target price on Clinigen shares which in afternoon trading were 2.4% higher at 1,013p.
-- Adds broker comment, updates share price --