Panacea inks drug development pact with Rising Pharma

Panacea Biotec has inked a pact with Rising Pharmaceuticals Inc to develop and market a 'product' in the American market.

The collaboration has been established for an oral controlled release product utilising Panacea's platform of oral drug delivery technology, Panacea Biotec Ltd said in a statement.

Rising specialises in the sales, marketing and distribution of finished pharma products in the US market,

"Upon commercialisation of the product both companies shall share the profits at a pre-agreed ratio. The product under the collaboration currently has a market size of more than $300 million in the US," it added.

As part of the pact, Panacea would receive an upfront research fee on signing as well as a milestone payment on approval of the "oral controlled release product" by Food & Drug Administration (FDA), it added.

The dossier for the product is currently under review by FDA.

Further, both companies intend to expand the scope of the alliance by adding new drug delivery based complex generic products to the collaboration, the statement said.

Under the collaboration, Panacea Biotec would undertake product development and manufacture and supply of the products; while Rising Pharmaceuticals shall be responsible for sales and distribution of the products in US, it added.

"The collaboration...Represents a true win-win strategic alliance wherein the commercialisation strength of Rising Pharmaceuticals for high barrier to entry generics perfectly synergises with Panacea Biotec's research, development and manufacturing capabilities for such complex products," Panacea Biotec Joint Managing Director Rajesh Jain said.

In the current fiscal, Panacea has inked multiple long term collaborations for North America and cumulatively these alliances translate to potential $13 million as milestone based research fee payments upon successful accomplishment of milestones, he added.

"The company has already received $2.5 million in Q1 FY2015 and close to $1 million is expected in the current quarter," Jain said.

Panacea shares were trading at Rs 169.90 apiece, up 6.25%, on the BSE in the afternoon.