Auxilium Sobi Collaborate


Auxilium Pharmaceuticals, Inc. (AUXL) recently entered into a long-term collaboration with Swedish Orphan Biovitrum AB (Sobi) for the development, supply and commercialization of Xiapex for the treatment of Dupuytren's contracture and Peyronie’s disease.

Xiapex, known as Xiaflex in the US, is currently approved in the US, EU, Switzerland, Norway and Canada for the treatment of Dupuytren's contracture. It is currently under FDA review in the US for the Peyronie’s disease indication with a response expected by Sep 6, 2013.

Under the collaboration, Sobi will have exclusive rights for the commercialization of Xiapex for the above-mentioned indications in 28 EU member countries, Switzerland, Norway, Iceland, 18 Central Eastern Europe/Commonwealth of Independent countries, including Russia and Turkey, and 22 Middle Eastern & North African countries.

Regulatory, clinical and commercialization activities in these countries will be handled by Sobi. The worldwide development of Xiapex remains Auxilium Pharma’s responsibility, which will also handle drug manufacturing and supply.

In return, Auxilium Pharma will be entitled to significant tiered double-digit royalties on Xiapex sales in Sobi's territories, including payment for product supply. Auxilium Pharma could also receive sales milestone payments of up to $40 million.

We note that Auxilium Pharma earlier had an agreement with Pfizer, Inc. (PFE) for Europe and certain Eurasian countries for the Dupuytren's and Peyronie's disease indications. However, this agreement was terminated earlier this year and the announcement of the collaboration was in line with expectations.

Auxilium Pharma has agreements with other companies also for Xiapex/Xiaflex. While one agreement is with Japan’s Asahi Kasei Pharma Corporation, the other is with Swiss biopharma company, Actelion (ALIOF).

Auxilium Pharma currently carries a Zacks Rank #2 (Buy). We expect investor focus to remain on lead product Testim’s sales and the regulatory status of Xiaflex for the Peyronie’s indication.

At present, Jazz Pharmaceuticals (JAZZ) looks more attractive with the company carrying a Zacks Rank #1 (Strong Buy).

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