Inspire, Allergan deal

The companies mutually terminated Inspire's rights and obligations to co-promote dry eye treatment Restasis cyclosporine under a 2001 deal with Allergan for Restasis and Prolacria diquafosol tetrasodium. Inspire remains eligible for worldwide royalties through 2020 on net sales of Restasis and any other human ophthalmic formulation of cyclosporine from Allergan. The 2010 royalty rate for Restasis will remain unchanged, decrease 3% in 2011, a further 0.25% in 2013 and a final 0.5% in 2014 through the end of 2020. Originally, Inspire was eligible to receive royalties for Restasis on a country-by-country basis, but the rate would have been decreased by 30% if Allergan terminated development of Prolacria and Inspire chose not to co-promote Restasis.

Inspire also regained all rights to dry eye candidate Prolacria, which it does not plan to continue to develop. In January, the uridine 5'-triphosphate (UTP) natural P2Y2 ligand missed the primary and secondary endpoints in a Phase III trial for dry eye. If Inspire resumes development of Prolacria, it has the option to offer Allergan commercialization rights in countries where Prolacria is approved. If Inspire receives all revenues for the product and does not offer Allergan rights to Prolacria in approved countries, Inspire's royalties received from Allergan for Restasis will terminate in that country (see BioCentury, Jan. 25). ...