Thursday, Depomed Inc. (DEPO) received a second $500,000 milestone payment under its worldwide license agreement from Covidien. The agreement focuses on the exclusive development of four acetaminophen/opioid analgesic combination products utilizing Depomed's Acuform gastric retentive drug delivery technology. The most recent payment from Covidien, which was received in December 2009, relates to the development of a formulation for the second product candidate under the collaboration.
Under the license agreement between Depomed and Mallinckrodt Inc., a Covidien company, Depomed received a one-time upfront payment of $4 million, a milestone payment for the first formulation in October 2009, and could receive up to $63.5 million in additional development milestone payments over the next several years. In addition, Covidien will pay Depomed a royalty on sales of products developed under the license agreement. Covidien is responsible for all development other than certain initial formulation work.
Depomed's Acuform technology is designed to enable extended and controlled release of oral medications in the upper gastrointestinal tract for once-daily administration, improved treatment tolerability and enhanced compliance and efficacy.
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