Cephalon has decided to return the US rights for the alcohol treatment Vivitrol to partner Alkermes, saying that the drug is not a core asset.

Under the terms of the agreement, Cephalon will pay Alkermes $11 million to cover its share of estimated losses on Vivitrol (naltrexone) for the next 12 months, and the latter will pay Cephalon $16 million to buy manufacturing equipment for the product. Alkermes added that the move will allow the company to record approximately $120 million in milestone and deferred revenues related to previous agreements with Cephalon as net collaborative profit.

Vivitrol, the first long-acting injectable medication commercially available for the treatment of alcohol dependence, is also being developed by Alkermes for opioid dependence. The latter will continue to market product in the USA with a commercial team of 70 staff.

David Broecker, Alkermes chief executive, said the firm “continues to believe in the potential for Vivitrol” but “carefully manage our investments…to align with the sales trajectory for the product".

His counterpart at Cephalon, Frank Baldino, noted that “"we have a lot of opportunities on our plate and cannot give Vivitrol the focus it deserves". He added that Alkermes “will be able to provide the necessary attention to this important product and we will work closely with them during this transition period (ie to the end of May) to ensure that patients and physicians continue to have access to this important medication”.

Alkermes said that it will continue to sell Vivitrol in the USA and expects the product to generate gross sales of $19-$24 million for fiscal 2009.