Watson Pharmaceuticals Inc. (WPI) along with partner Antares Pharma Inc. (AIS) announced the US approval of topical oxybutynin gel 3%. The US Food and Drug Administration (FDA) approved the drug for treating patients suffering from overactive bladder (OAB). By virtue of an exclusive licensing agreement, Watson Pharma plans to launch the drug in 2012.
Antares Pharma developed oxybutynin gel and out-licensed its US and Canadian commercialization rights to Watson Pharma in July 2011. According to the agreement, Watson Pharma is responsible for certain manufacturing start-up activities and will make payments to Antares Pharma on the achievement of certain regulatory and sales milestones. Additionally, after the launch of oxybutynin gel, Antares Pharma will receive escalating royalties on the US and Canadian sales of the drug.
The FDA approved the drug on the basis of phase III study results of oxybutynin gel, which demonstrated that patients dosed daily with 56 mg or 84 mg of the drug, experienced a statistically significant decrease in OAB symptoms, including the number of urinary incontinence episodes per day, compared to patients who received placebo.
We believe that the approval of oxybutynin gel will add to Watson Pharma’s OAB product portfolio, which comprises of Gelnique (oxybutynin chloride) gel 10%, and Oxytrol oxybutynin transdermal system.
Watson Pharma was in news earlier this month when it announced the launch of a generic version of Teva Pharmaceutical Industries Ltd.‘s (TEVA) LoSeasonique. The drug is used for the prevention of pregnancy. The launch of the generic drug took place as a part of a settlement agreement between the two companies.
We currently have an Outperform recommendation on Watson Pharma. The stock carries a Zacks #2 Rank (Buy rating) in the short-run.
