Scotland-based speciality pharma ProStrakan Group and Sweden’s Orexo have extended their existing European licensing agreement for the cancer pain drug Rapinyl to include North America.

The change follows the decision made by Endo Pharmaceuticals, following an internal review, to return all rights for Rapinyl, a fast-dissolving formulation of fentanyl, to Orexo. Endo has invested $40 million in the development of the drug and the Swedish firm has received an additional $26.9 million in licensing payments. Endo will finalise and finance the current Phase III studies of Rapinyl expected to end in December.

Now, under the terms of the new agreement with Orexo, ProStrakan will commit to upfront and certain regulatory and sales milestone payments of $29 million, including a $2 million signing fee. Also the conditions have changed the deal the firms had in Europe.

Approval milestones for the five biggest markets in Europe will change from 5 million euros to $5 million, while royalties for Europe have been increased by 7%-9% units and the royalty rate for North America will be increased by the same percent units compared to the agreement with Endo.

Rapinyl is currently in the latter stages of a Phase III trial in the USA and subject to its successful conclusion, the plan is to submit a New Drug Application for Rapinyl in 2009. The product is scheduled for launch in Sweden sometime during the third quarter, where it will be sold under the trade name Abstral.

ProStrakan chief executive Wilson Totten said that as an existing partner in Europe, obtaining the North American rights to Rapinyl “makes strong strategic sense…and we were delighted to be able to seize the opportunity”.