Adding another product to its growing allergy franchise, Inspire Pharmaceuticals Inc. licensed U.S. and Canadian rights to bilastine, a late-stage oral antihistamine compound for allergic rhinitis, from Spanish pharmaceutical firm FAES Farma SA.

In exchange for up to $89 million in up-front and milestone payments, Inspire gains rights to the oral tablet formulation of bilastine, a selective H1-antihistamine that has yielded positive results in two Phase III studies in allergic rhinitis conducted by FAES, as well as rights to other bilastine formulations, such as a syrup for pediatric administration, and the opportunity to develop the drug in the additional indication of chronic idiopathic urticaria.

Inspire, which already markets the ophthalmic allergy product Elestat, also picked up worldwide rights, with the exception of certain territories such as Spain and Portugal, to develop and commercialize an ophthalmic indication of bilastine.

Christy Shaffer, Inspire's president and CEO, called the deal "a really broad collaboration on the molecule itself."

In addition to Elestat (epinastine HCl ophthalmic solution), which Inspire markets for Irvine, Calif.-based Allergan Inc., the company is developing a nasal spray version of epinastine. That product, licensed from German firm Boehringer Ingelheim International GmbH, is in Phase II.

"Bilastine would fit nicely as an oral agent," Shaffer told BioWorld Today, as well as provide entry for Inspire into the estimated $3 billion market for oral allergy agents.

Specific terms call for Inspire to make an up-front payment of $7 million, with "the majority of the remaining payments" of up to $82 million "actually due upon approval or subsequent to approval," Shaffer said.

If the oral version of bilastine gains approval in the U.S. and Canada, Inspire agreed to pay Leioa, Spain-based FAES a 14 percent to 16 percent royalty on net sales. Upon development of an ophthalmic formulation, FAES would be entitled to a 10 percent royalty arrangement.

Inspire believes oral bilastine, which is protected by a U.S. patent through 2017, would generate revenues of $200 million at peak sales, with the drug holding its own among competitors, which include U.S. market leader Zyrtec, due to its favorable safety profile and non-sedating effect.

In fact, a 600-plus patient Phase III study conducted by FAES in seasonal allergic rhinitis found that bilastine had similar efficacy to Zyrtec (Pfizer Inc.) but "with considerably less sedation," said Don Kellerman, senior vice president of development for Durham, N.C.-based Inspire. The drug has been "studied pretty extensively," he said, "though there's not a lot published on it, and not a lot of awareness."

Bilastine has been tested in trials involving nearly 4,000 subjects, and FAES previously submitted an investigational new drug application with the FDA. So the first step for Inspire is to meet with the agency and determine what would be needed to seek U.S. approval.

"We intend to do at least one Phase III study," Shaffer said, "to allow U.S. investigators to become familiar with the product."

That study would begin in 2007, and likely would involve seasonal patient enrollment in allergic rhinitis.

Upon product approval, Inspire intends to expand its 64-member sales force by an additional 200 sales representatives and expand its reach from allergy specialists to select primary care physicians.

Bilastine is expected to become a near-term revenue source for Inspire, which had been seeking a late-stage product "that could be on the market in a relatively short period of time" and provide a "bridge to the commercialization" of the company's other Phase III products, Shaffer said.

Inspire has two approvable letters for dry-eye product diquafosol, the second of which came in December 2005, citing an inadequate replication of efficacy results, and the company plans meetings with the FDA to determine a path to approval. In the meantime, the company has started the first of two Phase III trials of denufosol tetrasodium, which is aimed at promoting mucociliary clearance in cystic fibrosis patients. (See BioWorld Today, Dec. 5, 2005.)

As part of the bilastine deal, Inspire agreed to allow FAES first right of negotiation to denufosol tetrasodium in the event that it decides to partner the CF product regionally outside the U.S. Though Shaffer said Inspire's goal is to secure a "pan-European partner," the company might decide later to parcel out regional rights, in which case FAES would have a commercialization option in Spain, Portugal and other areas.

Inspire, which plans to release its third-quarter earnings next week, reported a net loss of $5.4 million for three months ending June 30. At that time, the company had cash and cash equivalents of $99.2 million.

Its shares (NASDAQ:ISPH) closed at $5.21 Wednesday, down 13 cents.