Javelin Pharmaceuticals Inc. has partnered its Dyloject product in Europe with Therabel Pharma in a deal that brings Javelin $12 million up front and up to $59.5 million in future sales and regulatory milestones.

The deal, said Cambridge, Mass-based Javelin, eliminates the expenses it would have encountered marketing the product in Europe, and also provides the company with a financial runway expending to 2010. In addition to that $71 million, Javelin will earn a double-digit royalty on future net sales of Dyloject in all countries covered by the agreement.

When the deal is sealed, Therabel, of Brussels, Belgium, will take over all commercialization, regulatory, and manufacturing responsibilities related to Dyloject, along with the expenses associated with market approvals in the UK and EU. Javelin will remain involved in Dyloject's EU development through a joint steering committee. Approvals in the U.S. and EU are expected to be sought this year.

Commenting on the deal, Javelin CEO Martin Driscoll noted that his company is "retaining significant upside in Dyloject's future EU growth with a high-quality marketing partner while eliminating our European commercialization expenses." He said in a statement that Javelin partnered with Therabel because of its market success in hospital sales and pain management products in the EU.

Dyloject (diclofenac sodium for injection) is an injectable formulation of diclofenac, which is in Phase III trials in the U.S. and marketed in the UK as a nonsteroidal anti-inflammatory drug (NSAID) that is widely prescribed to treat postoperative pain. Javelin bills the product as an alternative to other NSAIDs for the treatment of postoperative and acute pain to decrease the need for morphine or other opioids.

In December, Javelin stock got a 27 percent stock bump when it revealed a successful Phase III trial of 277 patients with moderate-to-severe pain who underwent orthopedic surgery. Data showed Dyloject provided statistically significant pain relief compared to placebo. (See BioWorld Today, Dec. 10, 2008)

Although Dyloject was shown to be statistically superior to placebo, it was not statistically superior to another injectable pain reliever, ketorolac. Javelin, however, noted at the time that the data were "numerically superior" to ketorolac, a fact that might not show up on a label but can be used in marketing to distinguish Dyloject from the current care standard. The company also said Dyloject has been shown to have a faster onset and less surgical bleeding than ketorolac.

With Europe taken care of, Javelin said it will seek a "major partnership" in the U.S. for Dyloject and Phase III candidate Ereska (ketamine nasal spray) for severe-to-moderate pain in patients who can't use opioids because they have maxed out or their use is contraindicated.

Shares of Javelin (AMEX:JAV) gained 10 cents, to close at $1.20 cents Tuesday.