After a period of what can only be described as restlessness, XenoPort ($XNPT) has announced an agreement with GlaxoSmithKline ($GSK) to terminate the 2007 collaboration between the two companies for XenoPort's Horizant (gabapentin enacarbil), an extended-release form of gabapentin. GSK had commercialization and development rights in the U.S., where the drug was approved for the treatment of restless legs syndrome in April 2011, and for post-shingles pain in June 2012. All of these rights are being returned to XenoPort.
XenoPort will not be responsible for any of GSK's losses nor receive any revenue while the deal winds up. GSK will return any gabapentin enacarbil to XenoPort and will get annual payments of $1 million from the smaller company for 6 years beginning in 2016. GSK is also purchasing $20 million of XenoPort's common stock at a 12.5% premium, and XenoPort has the option to require GSK to purchase up to an additional $20 million at the same premium over the next 6 months.
This draws to a close a deal that has had a complex history over the last couple of years. In November 2010, XenoPort retrieved the ex-U.S. rights from GSK for Horizant, and then this year, it accused the bigger company of not making enough effort to sell the extended-release drug and tried to terminate the agreement. GSK hit back in February by suing XenoPort.
The agreement resolves all the ongoing litigation, with XenoPort acknowledging "that GSK fulfilled its contractual obligations on the development, manufacturing, and commercialization of Horizant." This could be a relief to both companies and allows XenoPort to start fresh.
- read the press release