Grunenthal GmbH has completed an agreement with Labopharm Europe Limited to distribute and supply its twice-daily tramadol acetaminophen pain treatment formulation to a number of countries in Europe.

Under the terms of the agreement, Grunenthal will own the exclusive right to market and sell Labopharm’s formulation.

In return Labopharm will receive an upfront payment of €3.5m and up to €4m in milestone payments on achievement of certain regulatory and product reimbursement approvals prior to the launch of the product.

Labopharm president and CEO James R Howard-Tripp said that this agreement represents the initial step in the international commercialisation plan for the company’s tramadol-acetaminophen product.

“We are in discussion with Grunenthal to potentially expand our agreement to include additional European countries. We are also in discussion with other potential partners to conclude distribution and supply agreements for other jurisdictions around the world,” Howard-Tripp said.

Labopharm will still be responsible for obtaining regulatory approval in most of the countries covered by the agreement.

The company is pursuing regulatory approval in Europe through the mutual recognition procedure and expects to submit its application for marketing authorisation to the reference member state by the end of 2009.