Ergomed cuts a risk-sharing deal on Ferrer's insomnia drug

The U.K.'s Ergomed takes a more hands-on approach to contract development than many CROs, and the company has inked another risk-sharing partnership, teaming up with Spain's Ferrer to progress an insomnia treatment.

Under the deal, Ergomed and Ferrer will run a multinational Phase IIa trial on Lorediplon, a GABAa modulator that has shown Phase I promise in insomnia, the two said. But instead of just trading work for cash, Ergomed will assume a portion of the clinical and regulatory costs of the trial in exchange for a share of future revenue, much like its previous deals with Cel-Sci ($CVM), Aeterna Zentaris ($AEZS) and OxThera.

"We are very pleased to co-invest with Ferrer in the development of Lorediplon, which has shown promising results in clinical trials to date," Ergomed CEO Miroslav Reljanovic said in a statement. "Our 7th co-development agreement establishes us as one of the leading worldwide companies completing deals under this innovative model."

The two expect to kick off the mid-stage study next quarter, planning to recruit about 130 patients at 12 centers across three countries.

Risk-sharing arrangements like Ergomed's are becoming more and more popular in the drug development world, highlighted by WuXi PharmaTech's ($WX) partnership with Ambrx, inVentiv Health's collaboration with Oncobiologics and Pfizer's ($PFE) recent tie-up with Avillion.

But despite the potential paydays involved in such deals, many CROs prefer to keep their client relationships more platonic, worrying that the high-risk game of drug development could wreck their thin margins or preferring to stay out of any arrangement that could force them to compete with their other partners.

- read the statement

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