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Optimer-AZN Join Forces for Dificid

Zacks Equity Research

Optimer Pharmaceuticals (OPTR) recently decided to collaborate with AstraZeneca (AZN) for the commercialization of Dificid (fidaxomicin) tablets. Dificid is indicated for the treatment of clostridium difficile infection (CDI).

As per the terms of the agreement, AstraZeneca will be responsible for the commercialization of Dificid in South America including Brazil, Central America, Mexico and the Caribbean.

Optimer will be receiving an upfront payment of $1 million along with up to $3 million in milestone payments on the first commercial sale in some countries and up to $19 million on the achievement of sales-related targets for Dificid in the specified regions.

Optimer will also receive double-digit payments on net sales in the collaboration territory, as per a supply agreement.

We remind investors that Dificid, Optimer’s sole marketed product, was launched in the US in July 2011 for treating patients suffering from clostridium difficile-associated diarrhea (:CDAD), the most common form of nosocomial, or hospital acquired, diarrhea. Dificid is also available in Canada. Moreover, Dificid is approved in the European Union under the trade name, Dificlir.

The company has an exclusive two-year agreement (through July 2013) with Cubist Pharmaceuticals (CBST) to co-promote Dificid in the US for the treatment of CDI.

Optimer also has an exclusive agreement with Astellas Pharma, under which Astellas has the rights to develop and commercialize Dificlir in Europe and certain other countries. In March 2012, Optimer entered into another collaboration and license agreement with Astellas Japan. Astellas was granted exclusive, royalty-bearing license and intellectual property to develop and commercialize Dificlir in Japan.

Our Recommendation

Currently, we have a Neutral stance on Optimer in the long run. The company carries a Zacks #3 Rank (Hold) in the short run.

We are positive on Optimer’s collaborative agreements for Dificid. AstraZeneca with its global presence and marketing experience should be a strong partner for Optimer. However, we remain concerned about Optimer’s dependence on a single product for growth.

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