INDIANAPOLIS -- Eli Lilly and Co. has struck a deal to sell a purer form of Prozac, a strategy intended to counter the huge revenue loss when patents on the bestselling anti-depressant expire within five years.
Under the deal announced Monday, Lilly will pay Sepracor Inc. $90 million plus royalties for the worldwide marketing rights to R-fluoxetine, a modified form of the active ingredient in Prozac.The new drug, still early in clinical trials, would not hit the U.S. market before 2001. But if it does, data suggests it will have fewer side effects than Prozac and may be more effective in treating other maladies such as obesity and premenstrual syndrome, said Lilly's top science officer, Dr. August Watanabe.
Sepracor patented a way to separate the two forms of the fluoxetine molecule so an unneeded portion is discarded, said Watanabe, executive vice president for science and technology.
"With recent advances in science, it's become much more feasible to separate the two," he said.
First approved in 1987, Prozac is the world's most commonly prescribed antidepressant, with sales of $2.6 billion last year and $2 billion through the first nine months of 1998. Doctors have prescribed it to more than 35 million people, including more than $18 million in the United States.
Lilly's biggest moneymaker is protected by two U.S. patents, one expiring in three years and the other in five years. Without patent protection, Prozac will lose U.S. sales to cheaper generic versions, as it already happening overseas.
Sepracor holds a method-of-use patent that would not expire until 2015 and has filed for other patents covering methods of treatment, formulations and manufacturing processes.
Lilly said it will pay Sepracor an upfront payment of $20 million, plus $70 million more in milestone payments as R-fluoxetine moves through development. Sepracor also will receive royalty payments on worldwide sales of the drug.
Lilly will also will pay all additional development work on the drug, including the cost of clinical trials.