Endo Pharmaceuticals Inc. on Friday fattened its pain management product portfolio with the addition of U.S. and Canadian marketing and distribution rights to a pair of development products belonging to SkyePharma plc, as well as options for other research-stage products.

SkyePharma, which a day earlier licensed out North American rights to a long-acting chemotherapeutic, will receive a $25 million up-front payment, as well as potential milestones and royalties that could vault the London-based firm's total take to well over $100 million. Chadds Ford, Pa.-based Endo, a wholly owned subsidiary of Endo Pharmaceuticals Holdings Inc., received an exclusive license to DepoMorphine and Propofol IDD-D, along with options to other pain-management products.

SkyePharma may receive further milestone payments totaling $95 million, which includes a total of $10 million for DepoMorphine through FDA approval. Milestone potential also includes $50 million for Propofol IDD-D - based on Insoluble Drug Delivery technology - payable upon certain regulatory advances, including FDA approval. The total also includes a $15 million payment receivable if net sales of DepoMorphine reach $125 million in a calendar year, and $20 million if its net sales reach $175 million. SkyePharma also will receive a share of each product's sales revenue that will increase from 20 percent up to a maximum of 60 percent of net sales as their combined sales achieve certain unspecified thresholds.

"Strategically, we position ourselves as a developer of pharmaceutical products rather than an integrated pharmaceutical company, so we do not have a sales capability and have no current intention to build a sales force," Valerie Tate, SkyePharma's director of investor relations, told BioWorld Today. "We need to find a way to bring our products to market."

On Thursday, SkyePharma licensed to Enzon Pharmaceuticals Inc. rights to DepoCyt, an injectable chemotherapeutic, as part of a larger deal that includes development of up to three other drugs. SkyePharma paid Bridgewater, N.J.-based Enzon $3.5 million for access to Enzon's PEG modification technology, which helps a drug stay in the body longer. SkyePharma will earn milestone payments for each product based on its technology that enters Phase II development.

Enzon paid a $12 million licensing fee for rights to DepoCyt, a sustained-release formulation of cytarabine, or Ara-C, for patients with lymphomatous meningitis. (See BioWorld Today, Jan. 3, 2002.)

But in order to license DepoCyt, SkyePharma reacquired U.S. marketing rights from Emeryville, Calif.-based Chiron Corp. and Canadian rights from Montreal-based Paladin Labs Inc. Terms of those deals were not disclosed.

"We are looking for the best partners to market our products," Tate said, adding that the company continues to look for a European distribution partner for DepoMorphine and Propofol IDD-D. Dublin, Ireland-based Elan Corp. plc owns DepoCyt's European rights.

Just last month, Basel, Switzerland-based Novartis AG, SkyePharma's development partner for an asthma product, filed with U.S. and European authorities for regulatory approval of the product. Tate said SkyePharma developed the delivery device for Foradil (formoterol fumarate), a fast-onset, long-acting bronchodilator (beta-agonist).

"And we do have other inhalation products in clinical development," she said.

For Endo, which markets Percocet to treat postoperative pain, the deal provides its first postsurgical, critical-care drugs.

"It's another step in expanding our footprint into the acute, critical-care setting," Bill Newbould, Endo's vice president of corporate communications, told BioWorld Today. "Percocet is used for postsurgical pain now, but it is not a hospital-based product. These are more hospital-based products."

He said DepoMorphine and Propofol IDD-D would stretch Endo's presence beyond teaching hospitals and into community-based facilities. Newbould said DepoMorphine could penetrate a $125 million injectable epidural market, which includes a pair of generic, 12- to 24-hour-acting drugs. DepoMorphine's sustained release lasts 48 hours. Propofol could operate in a $440 million market.

SkyePharma will maintain primary responsibility for clinical development up to final FDA approval, and for all product manufacturing costs.

DepoMorphine, a sustained-release injectable formulation of morphine sulfate, remains in Phase III development. Its sole active ingredient, encapsulated with SkyePharma's DepoFoam controlled-release delivery technology, is intended to manage postoperative pain. An initial Phase III study has shown that DepoMorphine has a safety profile typical for an epidural opioid agent and that patients experienced dose-related postoperative pain relief for 48 hours. The first trial's results were statistically significant, and SkyePharma said if the additional trial results are positive, it would submit a new drug application in the middle of this year.

Propofol IDD-D is an intravenous formulation of propofol using SkyePharma's IDD-D technology to improve solubility. Intended to maintain anesthesia in adults during surgery and sedation of adults hospitalized in an intensive-care setting, Propofol IDD-D is in a Phase II trial.

"We already sell to anesthesiologists as it is, so this is a natural fit for us," Newbould said.

Upon approval, Endo will market each product in the U.S. and Canada, with SkyePharma as the supplier. Endo, which will be responsible for all selling and marketing expenses, will fund and conduct any postmarketing studies.

Endo's options for other SkyePharma development products include DepoBupivacaine, a long-acting, sustained-release formulation of the local anesthetic, bupivacaine. Endo has the option to obtain commercialization rights to the product upon SkyePharma's completion of Phase II trials, as well as any further unspecified SkyePharma products formulated using the DepoFoam technology for the prophylaxis or treatment of pain.

"We have several products that fall into critical care, specifically pain management, where Endo's specialty is," Tate said. "So this is a really good strategic fit between the two companies, and hopefully is the start of a longer relationship."

Endo in the past year has entered a number of development relationships. In late July Endo acquired Manhasset, N.Y.-based BML Pharmaceuticals Inc., a purchase that included the rights to Immunol, an oral rinse in Phase III trials to treat oral mucositis. Newbould said Endo hopes to conclude the trials this year, with an NDA tentatively scheduled to be filed in about a year.

In November Endo in-licensed Cuppertino, Calif.-based Durect Corp.'s Chronogesic pain therapy system for the U.S. and Canada. Chronogesic is designed to provide the opioid sufentanil for an uninterrupted, three-month period in patients with chronic pain resulting from a variety of malignant and nonmalignant causes. (See BioWorld Today, Nov. 12, 2002.)

Last month, the company filed with the FDA a pair of NDAs for its opioid analgesic pain product candidates, filing with the FDA an application for both immediate- and extended-release oxymorphone oral tablets. (See BioWorld Today, Dec. 23, 2002.)

Endo's stock (NASDAQ:ENDP) rose 2 cents Friday to close at $8.11. SkyePharma's shares (NASDAQ:SKYE) jumped $1.25, or 17.4 percent, to close at $8.44.