Teva Pharmaceuticals Industries Ltd., of Jerusalem, teamed up with Xenon Pharmaceuticals Inc., of Burnaby, British Columbia, for the licensing of Xenon's sodium channel targeted drug, XEN402.

Under the agreement, Xenon will receive an up-front licensing fee of $41 million and will be eligible for development, regulatory and sales milestones of up to $335 million. Xenon also will receive royalties on sales and an option to participate in U.S. commercialization.

Those curious about Teva's marketing plan for XEN402, or the specific pain indications for it, will have to wait a little longer. "We do have an approach and plans. It's a very exciting strategy in an area of major medical need," Xenon's CEO Simon Pimstone told BioWorld Today. But revealing that strategy will be up to Teva at some later date.

Pimstone said Teva became interested in XEN402 because pain is part of one of its core franchises – neuroscience – and Teva has been looking at new mechanisms for development of pain drugs. Xenon had licensing discussions with a number of potential partners, but chose Teva in the end, Pimstone said.

Xenon developed XEN402 in-house, starting with identification of mutations affecting the protein Nav1.7, which underlie congenital indifference to pain, a rare disorder.

People with congenital indifference to pain are healthy, but they are vulnerable to complications from injuries because they can't feel pain, and as a result, don't seek medical attention soon enough.

The cause of congenital indifference to pain in some patients turns out to be a missing sodium channel, Nav1.7. Pimstone said another channel, Nav1.8, is also important in human pain sensation, and that XEN402 is designed to inhibit both.

In 2011 , Xenon reported that XEN402 produced significant and meaningful pain reductions in a Phase IIa trial in postherpetic neuralgia. More patients receiving XEN402 than placebo reported greater than 30 percent (p = 0.049) and 50 percent (p = 0.008) pain reductions.

The partnership with Teva is Xenon's seventh major deal. Other major pharma partners for the company include Takeda Oncology Co., Roche AG, Novartis AG, Pfizer Inc. and Merck & Co Inc.

Xenon's deal with Roche subsidiary Genentech Inc., signed in January 2012, could reach $649 million in value. That agreement gives Genentech exclusive license to compounds and an a nonexclusive license to diagnostics. (See BioWorld Today, Jan. 10, 2012.)

Another Roche partnership, in 2006, was valued at $51 million, and has a goal of investigating hemojuvelin, a defective protein underlying juvenile hemachromatosis.

A Merck partnership dating to 2009 could be worth up to $94.5 million for the first therapeutic target, and as much as $89.5 million for each subsequent target selected for discovery. That deal centers on cardiovascular drug discovery, with Xenon carrying out human and animal validation studies using its genetics platform.

Xenon is working with Takeda to develop and commercialize oral formulations of another pain product, XEN401, in Japan and other Asian countries. That deal was valued at $75.5 million plus development and sales milestones.

Xenon's 8-year-old partnership with Novartis is based on an obesity target, SCD1. Novartis agreed to precommercial payments up to $157 million, plus royalties on products developed from that collaboration.

And Xenon's longstanding partnership with Pfizer dates back to 2000, when it shook hands with Warner Lambert, later acquired by Pfizer, receiving $58 million to identify drug targets and lead compounds for low HDL cholesterol.

Xenon also has a number of unpartnered preclinical programs.

Pimstone said now that Xenon is partnered with Teva, it will be working with the pharma company to finalize a "robust" development plan, taking full advantage of oral and topical formulations.

"The company has really shown an ability to attract major R and D interest," Pimstone said. "This is a difficult financing market for private companies. We've been rather unique in our ability to advance products without having to go back to the private equity markets."

The next phase of development for Xenon, Pimstone said, is transitioning the company into "an organization we hope and believe will provide significant returns to shareholders."