Another day and yet another deal for Novartis, this time involving the acquisition of the North American rights to Vanda Pharmaceuticals’ schizophrenia drug Fanapt.

Under the terms of the deal, Vanda will receive an upfront payment of $200 million and be eligible for additional payments of up to $265 million upon achieving certain development and commercial milestones. It will also receive royalties on US and Canadian sales of Fanapt (iloperidone).

In return, Novartis has gained the rights to develop and commercialise a long-acting injectable version of the pill, a mixed dopamine D2/serotonin 5HT2A receptor antagonist. which was approved by the US Food and Drug Administration in May. The Swiss major, which sold the rights to iloperidone to Vanda in 2004, also has the option to enter into discussions to co-market Fanapt, or receive sales royalties, for non-North American territories.

The approval for Fanapt was somewhat surprising given that the FDA issued a not-approvable letter last year over concerns of efficacy compared with an established atypical antipsychotic, Johnson & Johnson's Risperdal (risperidone). However the drug appears to have a better side effect profile compared with other antipsychotic therapies, especially in terms of weight gain. Novartis plans to launch Fanapt in 2010.

Vanda chief executive Mihael Polymeropoulos said that “we now have one of the premier pharmaceutical companies in the world to commercialise the oral formulation” and further develop the injectable form of Fanapt. He added that it also allows his firm to use “current and future data generated by Novartis” on the oral and depot formulations to pursue regulatory approvals outside the USA and Canada."

The announcement of the Vanda deal came hours after Novartis signed an agreement with the UK’s Heptares-which will apply its technology to generate leads against a G-protein-coupled receptor target of interest to the Basel-based group. Four days ago, it snapped up the rights to market a potentially first-in-class antibiotic from Paratek Pharmaceuticals for an undisclosed sum.