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news.M Pharmaceutical has entered into a letter of intent (LOI) to acquire assets from Chelatexx related to a reformulated version of orlistat (product "C-103").
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The addition of C-103 provides a novel weight loss pharmaceutical product to the M Pharma pipeline. Indicative terms of the letter of intent include an up-front cash payment, 10 million common shares of M Pharmaceutical, and a low single-digit royalty on net sales.
The transaction is subject to finalizing terms in a definitive agreement within the next 14 calendar days and certain closing conditions which are expected to conclude by January 2016.
M Pharmaceutical CEO Matthew Lehman said: "The acquisition of C-103 from Chelatexx, LLC is an exciting addition to the M Pharmaceutical pipeline. This product fits into our mission of developing innovative technologies for obesity with fewer side effects than currently available products."
Background information on Orlistat
Orlistat is currently marketed in prescription strength by Roche Laboratories (Xenical 120mg capsules) and in over-the-counter strength by GlaxoSmithKline Consumer Healthcare (alli 60mg capsules).
Orlistat has proven safe and effective in numerous clinical trials and remains the only FDA-approved weight management drug for a pediatric population (adolescents 12 years and older). Orlistat does not affect the central nervous system and it is not systemically absorbed, as compared to other approved weight management drugs.
Recent sales of orlistat have declined from its peak due to uncomfortable and well-publicized side effects of the product. The development goal of the C-103 reformulation is to maintain the proven efficacy of orlistat while minimizing or eliminating the undesirable side effects. Chelatexx, LLC holds issued U.S. patents covering C-103 technology until 2030.
The U.S. Food and Drug Administration has confirmed in writing that C-103 is eligible for 505(b)(2) approval in the U.S., under which the FDA is permitted to rely, for approval of the new drug, on data not developed by the applicant – such as published literature or the FDA’s finding of safety and/or effectiveness of a previously approved drug product.
The Company cautions that there is no guarantee that C-103 will achieve its development goals and that there are no guarantees that C-103 will be approved by any health regulatory agency.
Corporate Strategy Update
M Pharma also announced a significant reorganization of its priorities to concentrate on the development of its two oral products – C-103 and Trimeo – for obesity treatment and weight loss.
M Pharma believes that both C-103 and Trimeo have potential to address the growing obesity problem. In conjunction with the Company’s reorganization, it will minimize continued investment in its two earlier stage technologies Trimtec and eMosquito and review potential opportunities to divest or partner these technologies.