Healthcare Industry News:  Novartis Pharmaceuticals 

Biopharmaceuticals Licensing

 News Release - October 12, 2009

Novartis Enters Into Agreement for Exclusive US and Canadian Rights to Fanapt(TM), an FDA-Approved Oral Therapy for Schizophrenia

Fanapt (iloperidone), an antipsychotic therapy, is indicated in US for the acute treatment of schizophrenia in adults, set for US launch in early 2010

Addition of Fanapt will strengthen Novartis psychiatry portfolio and build on history in schizophrenia

Schizophrenia is a chronic, severe and disabling psychiatric disorder estimated to affect more than two million adults in the US and nearly 250,000 Canadians

Rights to Fanapt acquired from Vanda Pharmaceuticals Inc. for upfront payment of USD 200 million; Vanda eligible for milestones and sales royalties

EAST HANOVER, N.J., Oct. 12 (Healthcare Sales & Marketing Network) -- Novartis Pharma AG has entered into an agreement for exclusive US and Canadian rights to Fanapt(TM) (iloperidone), a new oral medication that is approved by the US Food and Drug Administration (FDA) for the acute treatment of adults with schizophrenia. Novartis plans to launch Fanapt in the US in early 2010.

As part of the agreement with Vanda Pharmaceuticals Inc., Novartis will have exclusive commercialization rights to the oral formulation of this medicine in the US and Canada as well as exclusive rights to develop and commercialize a long-acting injectable (or "depot") formulation of this medicine for these markets.

Schizophrenia is a severe psychiatric disorder that is estimated to affect more than 2 million adults in the US and nearly 250,000 Canadians. Fanapt belongs to a class of medication for schizophrenia known as atypical antipsychotics.

"Schizophrenia remains one of the most chronic and debilitating of the major psychiatric illnesses, underscoring the need for new treatment options," said Ludwig Hantson, PhD, Head of Pharma North America, CEO, Novartis Pharmaceuticals Corporation. "With the launch of Fanapt in early 2010, we will broaden our presence in psychiatry and build on the heritage of Novartis in offering innovative treatments for devastating psychiatric diseases."

In the 1970s, Novartis pioneered the first atypical antipsychotic medication which was considered a breakthrough for patients with treatment-resistant schizophrenia. Novartis also offers medications for Alzheimer's disease, attention deficit hyperactivity disorder (ADHD), Parkinson's disease and multiple sclerosis.

Vanda completed Phase III clinical trials in 2006 and gained US regulatory approval for this medicine in May 2009.

Terms of the agreement

Novartis will make an upfront payment to Vanda of USD 200 million for the exclusive rights to commercialize the oral tablet, which is already approved in the US, in the territory of the US and Canada, as well as to develop and commercialize a depot formulation of Fanapt for patients in this territory. Vanda will be eligible for additional payments upon achieving defined development and commercial milestones and will also receive sales royalties. Vanda will retain rights to develop and commercialize Fanapt outside the territory of US and Canada, but Novartis has the option to enter into discussions with Vanda to co-commercialize Fanapt or receive sales royalties outside this territory. The consummation of the transaction is subject to the receipt of customary regulatory approvals, which are expected by the end of 2009.

Important Safety Information

Fanapt is indicated for the acute treatment of schizophrenia in adults.

Increased Mortality: Elderly patients with dementia-related psychosis treated with antipsychotic drugs are at an increased risk of death compared to placebo. Fanapt is not approved for the treatment of patients with dementia-related psychosis.

QT Prolongation: In an open-label QTc study in patients with schizophrenia or schizoaffective disorder (N=160), Fanapt was associated with QTc prolongation of 9 msec at an iloperidone dose of 12 mg twice daily. This affect was augmented by the presence of CYP450, 2D6 or 3A4 metabolic inhibition. The use of Fanapt should be avoided in combination with other drugs that are known to prolong QTc. Caution is warranted when prescribing Fanapt with drugs that inhibit Fanapt metabolism.

Neuroleptic Malignant Syndrome (NMS):A potentially fatal symptom complex, has been reported in association with administration of antipsychotic drugs. Clinical manifestations include hyperpyrexia, muscle rigidity, altered mental status, and evidence of autonomic instability (irregular pulse or blood pressure, tachycardia, diaphoresis and cardiac dysrhythmia). Additional signs may include elevated creatine phosphokinase, myoglobinuria (rhabdomyolysis) and acute renal failure.

Tardive Dyskinesia (TD): The risk of developing TD and the likelihood for it to become irreversible are believed to increase as the duration of treatment and the total cumulative dose increases. However, the syndrome can develop, although much less commonly, after relatively brief treatment periods at low doses. Given these considerations Fanapt should be prescribed in a manner that is most likely to minimize the occurrence of tardive dyskinesia.

Hyperglycemia and Diabetes Mellitus: Hyperglycemia, in some cases extreme and associated with ketoacidosis, hyperosmolar coma or death, has been reported in patients treated with atypical antipsychotics including Fanapt. Patients with risk factors for diabetes mellitus who are starting treatment with atypical antipsychotics should undergo fasting blood glucose testing at the beginning of and during treatment. Any patient treated with atypical antipsychotics should be monitored for symptoms of hyperglycemia including polydipsia, polyuria, polyphagia and weakness. Patients who develop symptoms of hyperglycemia during treatment with atypical antipsychotics should also undergo fasting blood glucose testing. In some cases, hyperglycemia has resolved when the atypical antipsychotic was discontinued; however, some patients required continuation of anti-diabetic treatment despite discontinuation of the suspect drug.

Weight Gain: Based on the pooled data from the four placebo-controlled, 4- or 6-week, fixed- or flexible-dose studies, the proportions of patients having a weight gain of greater than or equal to 7% body weight was 12% for Fanapt 10-16 mg/day, 18% for Fanapt 20-24 mg/day, and 13% for Fanapt (combined doses) versus 4% for placebo.

Seizures: In short-term placebo-controlled trials (4- to 6-weeks), seizures occurred in 0.1% (1/1344) of patients treated with Fanapt compared to 0.3% (2/587) on placebo. As with other antipsychotics, Fanapt should be used cautiously in patients with a history of seizures or with conditions that potentially lower the seizure threshold.

Orthostatic Hypotension and Syncope: Fanapt can induce orthostatic hypotension and syncope. Fanapt should be used with caution in patients with known cardiovascular disease, cerebrovascular disease, or conditions that predispose the patient to hypotension.

Leukopenia, Neutropenia, and Agranulocytosis: In clinical trial and postmarketing experience, events of leukopenia/neutropenia have been reported temporally related to antipsychotic agents. Agranulocytosis (including fatal cases) have been reported. Patients with a pre-existing low white blood cell count (WBC) or a history of leukopenia/neutropenia should have their complete blood count (CBC) monitored frequently during the first few months of therapy and should discontinue Fanapt at the first sign of a decline in WBC in the absence of other causative factors.

Hyperprolactinemia: As with other drugs that antagonize dopamine D2 receptors, Fanapt elevates prolactin levels. Galactorrhea, amenorrhea, gynecomastia and impotence have been reported in patients receiving prolactin-elevating compounds.

Body Temperature Regulation: Disruption of the body's ability to reduce core body temperature has been attributed to antipsychotic agents. Appropriate care is advised when prescribing Fanapt for patients who will be experiencing conditions which may contribute to an elevation in core body temperature.

Dysphagia: Esophageal dysmotility and aspiration have been associated with antipsychotic drug use. Aspiration pneumonia is a common cause of morbidity and mortality in elderly patients, in particular those with advanced Alzheimer's dementia.

Suicide: The possibility of suicide attempt is inherent in psychotic illnesses, and close supervision of high-risk patients should accompany drug therapy. Prescriptions for Fanapt should be written for the smallest quantity of tablets consistent with good patient management in order to reduce the risk of overdose.

Priapism: Three cases of priapism were reported in the pre-marketing Fanapt program. Severe priapism may require surgical intervention

Potential for Cognitive and Motor Impairment: Fanapt , like other antipsychotics, has the potential to impair judgement, thinking, or motor skills. Patients should be cautioned about performing activities requiring mental alertness, such as operating hazardous machinery or operating a motor vehicle, until they are reasonably certain that Fanapt therapy does not affect them adversely.

Common adverse reactions include dizziness, dry mouth, fatigue, nasal congestion, orthostatic hypotension, somnolence, tachycardia and weight gain.

For additional warnings, precautions and complete prescribing information, go to Vanda's web site:


The foregoing release contains forward-looking statements that can be identified by terminology such as "set," "will," "eligible," "plans," "option," "expected," or similar expressions, or by express or implied discussions regarding the potential consummation of the acquisition of Fanapt by Novartis, potential additional marketing approvals for Fanapt products, Novartis obtaining potential additional marketing rights to Fanapt, or regarding potential future revenues from Fanapt. You should not place undue reliance on these statements. Such forward-looking statements reflect the current views of management regarding future events, and involve known and unknown risks, uncertainties and other factors that may cause actual results with Fanapt to be materially different from any future results, performance or achievements expressed or implied by such statements. There can be no guarantee that the proposed Fanapt acquisition will be completed in the expected form or within the expected time frame or at all. Nor can there be any guarantee that Fanapt products will be approved for sale in any additional markets or that Novartis will obtain marketing rights to Fanapt in additional markets. Neither can there be any guarantee that Fanapt will achieve any particular levels of revenue in the future. In particular, management's expectations regarding Fanapt could be affected by, among other things, unexpected regulatory actions or delays or government regulation generally; unexpected clinical trial results, including unexpected new clinical data and unexpected additional analysis of existing clinical data; competition in general; government, industry and general public pricing pressures; the company's ability to obtain or maintain patent or other proprietary intellectual property protection; the impact that the foregoing factors could have on the values attributed to the Novartis Group's assets and liabilities as recorded in the Group's consolidated balance sheet, and other risks and factors referred to in Novartis AG's current Form 20-F on file with the US Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, believed, estimated or expected. Novartis is providing the information in this press release as of this date and does not undertake any obligation to update any forward-looking statements contained in this press release as a result of new information, future events or otherwise.

About Novartis Pharmaceuticals Corporation

Novartis Pharmaceuticals Corporation researches, develops, manufactures and markets leading innovative prescription drugs used to treat a number of diseases and conditions, including those in the cardiovascular, metabolic, cancer, organ transplantation, central nervous system, dermatological, GI and respiratory areas. The company's mission is to improve people's lives by pioneering novel healthcare solutions.

Located in East Hanover, New Jersey, Novartis Pharmaceuticals Corporation is an affiliate of Novartis AG, which provides healthcare solutions that address the evolving needs of patients and societies. Focused solely on healthcare, Novartis offers a diversified portfolio to best meet these needs: innovative medicines, preventive vaccines, diagnostic tools, cost-saving generic pharmaceuticals, and consumer health products. Novartis is the only company with leading positions in these areas. In 2008, the Group's continuing operations achieved net sales of USD 41.5 billion and net income of USD 8.2 billion. Approximately USD 7.2 billion was invested in R&D activities throughout the Group. Headquartered in Basel, Switzerland, Novartis Group companies employ approximately 98,000 full-time-equivalent associates and operate in more than 140 countries around the world. For more information, please visit

Source: Novartis

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