Avadel Pharmaceuticals has signed an exclusive worldwide licensing deal with XWPharma for the development and commercialisation of valiloxybate, to treat sleep disorders such as idiopathic hypersomnia (IH) and narcolepsy.
The agreement positions Avadel to leverage a formulation intended for once-nightly administration without the inclusion of artificial sweeteners or salts.
The arrangement grants Avadel the rights to develop, produce and market the therapy worldwide, with the exception of mainland China, Macau and Hong Kong.
XWPharma will receive an initial $20m by Avadel and gain up to $30m more, contingent on the achievement of specific development milestones.
The company has committed to a series of performance-based payments to XWPharma, which could be up to an aggregate of $155m, based on reaching annual net sales thresholds up to $750m.
Should sales surpass this figure, XWPharma is set to earn additional sales milestone payments equal to 10% of those figures up to $3.5bn.
The agreement also includes royalty payments to XWPharma, calculated as a percentage of net sales and ranging from high-single digits to mid-teens.
Avadel has also agreed to an extra milestone payment of $10m following the first commercial sale in the US for each new indication approved by the Food and Drug Administration (FDA) beyond narcolepsy and IH.
Avadel anticipates initiating a preliminary pharmacokinetic trial for its valiloxybate formulation in the last quarter of 2025, with a pivotal trial in the second half of 2026.
Avadel Pharmaceuticals CEO Greg Divis stated: "The addition of valiloxybate, the only once-at-bedtime, salt-free and artificial sweetener-free, extended-release oxybate, into our portfolio further reflects Avadel’s position as a leader in sleep medicine.
“The broad adoption of Lumryz demonstrates the transformative benefits that a once-at-bedtime oxybate therapy can bring to patients and their families. As an innovator in the treatment of sleep disorders, we are excited to add valiloxybate to our pipeline.”
In 2024, Avadel secured US Food and Drugs Administration approval for the supplemental new drug application of the narcolepsy drug Lumryz for children.
