SkyePharma is in line to receive a cash boost following the news that partner GlaxoSmithKline has received the thumbs-up from US regulators to market an extended-release version of Requip for Parkinson’s disease.

The US Food and Drug Administration has backed Requip XL (ropinirole extended-release tablets) to treat the signs and symptoms of idiopathic Parkinson's disease and GSK noted that the product, the first oral once-daily non-ergot dopamine agonist indicated for the disease, should be available by mid-July in the USA.

The formulation uses SkyePharma’s Geomatrix technology tri-layer formulation which allows for continuous delivery of ropinirole over 24 hours to provide smooth blood levels. As a result of the go-ahead, the UK firm will receive low-to mid-single digit royalties from GSK, which already has approval for Requip XL in 23 countries in Europe.

More good news on Flutiform
The go-ahead for Requip XL in the USA is big news for SkyePharma which is waiting for the results to come in from two Phase III efficacy trials for Flutiform (fluticasone and formoterol), the company's flagship product for the treatment of asthma. Preliminary findings from the second of those trials has just been announced and shows that Flutiform, as a potential treatment of moderate to severe asthma in adolescent and adult patients has met its primary endpoints. All going well, the firm hopes to file the combination treatment in the USA in the first quarter of 2009.

However SkyePharma is facing a potential problem financially amid concerns about the firm’s ability to refinance the terms of convertible bonds that could result in liabilities of almost £90 million over the next two years.

Analysts at Landsbanki seem less perturbed, however, and issued a research note saying that worries regarding the bond debt “are exaggerated”. They noted that the bonds “are tightly held, with the majority in the hands of a relatively small number of investors” and they will be looking to “maximise share price value through the successful filing and launch of Flutiform,' it said.

As for the Requip XL approval, the analysts have conservatively forecast 2011 sales of £190 million pounds, with royalties to the firm reaching around £9.5 million. They reiterated a ‘buy’ recommendation on the stock, but noted that SkyePharma will be most attractive to “the patient, longer-term value investor”.