Recce Pharmaceuticals (ASX:RCE) signs exclusive Arrotex commercialisation agreement
Recce Pharmaceuticals has entered an exclusive licence and commercialisation agreement with Arrotex Pharmaceuticals for RECCE® 327 topical gel in Australia and New Zealand.
The binding agreement, which is not subject to conditions precedent, covers treatment in humans of diabetic foot infection and acute bacterial skin and skin structure infection, with Recce remaining the exclusive manufacturer and supplier.
Highlights
Recce will receive a significant profit share of gross margin on Arrotex’s R327G sales in the territory, paid quarterly.
The agreement provides no upfront or milestone payments, while Arrotex bears all local commercialisation costs.
R327G remains investigational and is currently in registrational Phase 3 clinical development for diabetic foot infections in Australia and Indonesia.
Under the supply arrangements, Recce will manufacture R327G and supply the product at its cost plus margin, credited against its profit share.
Gross margin is defined as net sales less Recce’s cost of goods, while the company continues to fund global clinical development, manufacturing and regulatory filings outside the territory.
Arrotex’s responsibilities include Australian and New Zealand regulatory filings, PBS and Pharmac submissions, and sales and marketing.
Recce retains ownership of all intellectual property, all rights outside the territory and outside human pharmaceutical use, and the right to conduct clinical trials within Australia and New Zealand.
Recce managing director and chief executive James Graham said, “
Arrotex is a leading regional partner with the infrastructure and healthcare relationships needed to prepare R327G for the market, subject to successful clinical development and regulatory approval.”
The agreement’s exclusivity provisions prevent Recce from appointing another commercial partner in the territory for any presentation of RECCE® 327.
New presentations, such as intravenous or inhaled formulations, are subject to good faith negotiation and, if terms are not agreed within 90 days, a right of first refusal in favour of Arrotex.
The regulatory pathway specifies that Arrotex is only required to apply for TGA approval after R327G is approved by the US Food and Drug Administration, the European Medicines Agency or another regulator recognised by the TGA as a comparable overseas regulator.
The agreement continues until the later of expiry of the last licensed Recce patent covering R327G in the territory and 10 years after the first commercial sale in Australia, then from year to year unless either party gives 12 months’ notice.
Among other customary termination rights, Arrotex may terminate without penalty if Recce discontinues its FDA or EMA regulatory pathway for R327G.
Recce may terminate, or make the licence non-exclusive, if Arrotex fails to apply for approval or launch within the required timeframes.
R327 is a synthetic anti-infective being developed for serious and potentially life-threatening infections caused by Gram-positive and Gram-negative bacteria, including antibiotic-resistant pathogens.
Its topical gel formulation is being studied for bacterial wounds, burns and skin infections.
The announcement estimates approximately 50,000 people in Australia are living with a diabetes-related foot ulcer, with about 300,000 more considered at risk.
Diabetic foot infections may lead to hospitalisation, surgery or amputation if not effectively managed.
R327 has not been approved for commercial use in Australia, New Zealand or the United States, and any future availability in Australia or New Zealand remains subject to successful completion of clinical development and applicable regulatory approvals.