Recro Pharma agrees to buy assets from Alkermes for $170m

The deal will see Recro Pharma secure worldwide rights to IV/IM meloxicam and also a contract manufacturing facility, royalty and formulation business in Gainesville, Georgia, US.

IV/IM meloxicam is a proprietary, Phase III-ready, long-acting COX-2 NSAID for moderate to severe acute pain. It has been designed using NanoCrystal platform, a technology that provides improved bioavailability of poorly water-soluble drug compounds.

As part of the deal, Recro will pay Alkermes $50m at closing, and also secure the ownership of a GMP manufacturing facility and related Gainesville business.

An additional $120m in milestone payments are also entitled for Alkermes, following the achievement of certain regulatory and net sales milestones and royalties, in each case, related to IV/IM meloxicam.

At closing, Alkermes will be issued a seven-year warrant to purchase an aggregate of 350,000 shares of Recro Pharma common stock.

Recro Pharma president and chief executive officer Gerri Henwood said: "This transaction was funded through a minimally dilutive transaction with OrbiMed and we believe this transaction represents a significant endorsement of Recro.

"We look forward to the upcoming interim results and expected mid 2015 top-line data readout of our Post Op Day 1 Phase II trial of Dex-IN, to the potential of moving one or both of these programs into Phase III by year end and to realizing value from our new manufacturing capabilities."

Subject to customary closing conditions, including antitrust regulatory approval, the acquisition is expected to be completed in the second quarter of 2015.

In five Phase II trials conducted in more than 700 patients with acute pain, IV or IM meloxicam has showed favorable analgesic properties, including rapid onset of pain relief and time to peak analgesic effect, 18 to 24 hour duration of pain relief and good tolerability.