Contributing Writer

EpiCept Corp. gave fellow pain specialist Durect Corp. exclusive worldwide rights to intellectual property concerning a transdermal bupivacaine patch for the treatment of back pain. In exchange, Durect will pay EpiCept $1 million up front and $9 million in milestone payments and royalties on future sales.

Jack Talley, president and CEO of EpiCept, said in a statement that the deal is similar "in economic terms" to an existing arrangement with pain player Endo Pharmaceuticals Inc.

EpiCept previously granted Endo exclusive worldwide rights to patents concerning a transdermal lidocaine patch for chronic back pain. Endo markets a transdermal lidocaine patch, Lidoderm, for post-herpetic neuralgia, and is conducting Phase II trials in other indications. Endo and EpiCept are also partners on the version of the drug for acute back pain, LidoPAIN BP, which EpiCept is developing internally. LidoPAIN BP demonstrated a statistically significant reduction in back pain in a Phase IIa trial, but failed to meet its endpoints in a Phase IIb trial due to a higher than expected placebo effect at one trial site. EpiCept expects to begin a pivotal Phase IIb trial in 2007.

The milestones EpiCept receives from Endo and will now receive from Durect are much needed: Third quarter operating expenses used up $6.2 million of the company's net cash, leaving EpiCept with only $11.5 million in cash as of Sept. 30, 2006. But just last week the Tarrytown, N.Y.-based company got some additional relief by raising $10 million through a private stock and warrant sale. Proceeds from the financing are being used for general corporate purposes, which may include advancing EpiCept's pipeline of pain and oncology products, including several pain patches.

Durect is no stranger to pain patches either - or to bupivacaine, or to Endo Pharmaceuticals, for that matter. Cupertino, Calif.-based Durect is partnered with Endo on a Phase II sufentanil patch for chronic pain. The patch uses Durect's Transdur technology, a small, non-irritating skin patch with strong adhesion that can deliver drugs at a controlled rate for up to a week. Last month, Durect signed a $202 million marketing deal with Nycomed A/S for Posidur, a long-acting version of bupivacaine developed by Durect for the treatment of postsurgical pain. (See BioWorld Today, Dec. 1, 2006).

EpiCept (Nasdaq:EPCT) rose 10 cents on the deal to close at $1.49, while Durect (Nasdaq:DRRX) rose 5 cents to close at $4.54.

Neither company returned calls seeking comment.