Published On: Thu, Feb 27th, 2014

Salix Pharma Licenses Israeli Company Redhill’s Bowel Treatment

RedHill Biopharma and Salix Pharmaceuticals Announce Worldwide Exclusive License Agreement for RedHill’s RHB-106 Encapsulated Bowel Preparation.

Salix-Pharmaceuticals-Ltd.
Salix Pharmaceuticals Ltd.  (NASDAQ: SLXP) and RedHill Biopharma Ltd. (NASDAQ: RDHL; TASE: RDHL) have entered into an exclusive agreement by which Salix has licensed the worldwide exclusive rights to RedHill’s RHB-106 encapsulated formulation for bowel preparation and rights to other purgative developments.

Financial terms of the transaction include an upfront payment of $7 million and $5 million in subsequent milestone payments to RedHill. Salix also has agreed to pay RedHill tiered royalties on net sales, ranging from low single-digit up to low double-digits. Under the worldwide license agreement, the parties also agreed on potential strategic collaboration with regard to certain other Salix products in specific territories.

RedHill-Biopharma logoCarolyn Logan, President and Chief Executive Officer, Salix said: “Many patients find the taste and palatability of current bowel prep products to be unacceptable. We believe the availability of a tasteless solid oral formulation bowel prep, if approved by the FDA, could potentially go a long way in helping to increase patient compliance and to ease patient burden associated with bowel cleansing prior to various medically important abdominal procedures.”

Dror Ben-Asher, RedHill Biopharma’s CEO, said: “The licensing transaction with Salix is an important milestone for RedHill and yet another validation of our business model. This is the first licensing deal derived from RedHill’s late clinical-stage pipeline, and we are confident that Salix, a leading company in the gastrointestinal field with a proven track record in drug development and commercialization, is the right partner. I would like to thank our shareholders for their continued support and RedHill’s team for their hard work and dedication towards the realization of this important transaction.”

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