Richter signed an agreement with ProStrakan Group to distribute pain-killer Rapinyl in seven Central and Eastern European countries. Rapinyl is a new, tablet formulation of fentanyl, and might be a successful treatment against cancer pain.
Under the terms of the agreement, ProStrakan will receive an upfront payment plus approval and sales milestones. ProStrakan will retain responsibility for obtaining marketing approval for Rapinyl in each of the licensed territories (Estonia, Latvia, Lithuania, Poland, Czech Republic, Slovak Republic and Hungary) and will supply Rapinyl at an agreed transfer price, while Gedeon Richter will be responsible for obtaining pricing and reimbursement approvals. The two companies will collaborate on a marketing and launch plan for Rapinyl in these territories.
Our view: The statement neither reveal the size of the payments from Richter, nor the potential size of the market for Rapinyl. However, in an optimistic scenario Rapinyl could reach some US$ 30-50m annual turnover in CEE region, according to our estimates. Calculating with 5-10% net margin, Richter might generate US$ 2-4m profit from the new drug in 3-5 years time. The currently unknown milestone payments, however, could lower this sum. We consider the news as slightly positive, as it shows the efforts of the company to renew its product portfolio.