Ipsen bows out of troubled toremifene pact with GTx

More than a year after GTx was hammered ($GTXI) by the FDA's rejection of toremifene and its demand for a new clinical trial of the bone loss drug, France's Ipsen has opted to bow out of its development deal for the drug.

The deal derailed despite a renegotiation of the pact last March, in which Ipsen agreed to pay for more R&D in exchange for broader global rights to the drug. Their original deal stretches back to 2006, when Ipsen paid $30 million upfront to gain rights to the drug.

"We spent significant time analyzing the business case for toremifene 80 mg and have concluded that the most appropriate course is to terminate our collaboration," said Dr. Mitchell S. Steiner, MD, CEO of GTx. The termination followed a careful analysis of the cost of another late-stage trial, he added, which exceeded a threshold spelled out in their revised partnership deal. In return for handing back its rights to the drug Ipsen stands to gain a low single digit royalty on any future sales.

The FDA's position is that the developer will have to mount a new trial to study the safety and efficacy of the drug, which is intended to prevent bone loss among prostate cancer patients. In particular, regulators said they wanted to make sure there was no "detrimental effect on either time-to-disease progression or overall survival." GTx shares slipped about six percent on the news today.

- here's the GTx release