BioWorld International Correspondent

LONDON - SkyePharma plc announced an exclusive U.S. sales and marketing agreement with First Horizon Pharmaceutical Corp. for a cardiovascular product that could total $50 million in milestone payments, plus 25 percent of net sales. The product is under review by the FDA, with approval expected by the end of this year.

Michael Ashton, CEO of SkyePharma, told BioWorld International: "We are delighted. We will receive $20 million in 2004, up to FDA approval, followed by $30 million in sales-related milestones, and from day one will get 25 percent net on sales. Our strategy is to look for a larger share of end sales, and we have even said we would compromise on milestones, but in this case we didn't have to."

SkyePharma will contribute $5 million to First Horizon's marketing expenses to establish the product, but that will be spread over three years.

Aston declined to give further details of the product for competitive purposes. SkyePharma will manufacture the product at its facility in Lyon, France.

London-based SkyePharma slipped back into losses in 2003 after reporting a profit in 2002. Turnover decreased by 24 percent, and costs rose because the budget was based on the assumption that partners would take over the funding of development work. Last month SkyePharma raised £20 million (US$36.4 million) privately to give it "additional flexibility" during partnering negotiations, it said.

Regarding the agreement, Ashton said: "This is a good deal, albeit late. But I think we have made enough apologies for that. We were perhaps too vocal in our expectations of getting deals done." The company still is promising one more deal and Ashton said it will be completed soon.

Alpharetta, Ga.-based First Horizon is a specialty sales and marketing company focused on cardiology and women's health/pediatrics. Its lead products are Sular, a calcium channel blocker for hypertension, and Nitrolingual for angina. The 360-person sales force sells the company's products. Ashton said he has known the U.S. company for some time, but held off doing a deal until First Horizon completed a recent $200 million fund raising.

The deal also gives First Horizon first refusal to license a further cardiovascular product using SkyePharma's delivery technology.