Auxilium To Promote Testosterone Gel With Glaxo; Raises View
05/21/2012| 08:15am US/Eastern
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Auxilium Pharmaceuticals Inc. (>> Auxilium Pharmaceuticals, Inc.) raised its full-year outlook as it entered an agreement with the U.S. unit of GlaxoSmithKline PLC (GSK) to co-promote a testosterone replacement therapy.
Auxilium and GlaxoSmithKline LLC said they will collaborate to promote Testim 1%, a testosterone gel for treating men with a deficiency or absence of the hormone.
Auxilium Chief Executive Adrian Adams said low testosterone, known as hypogonadism, is a prevalent but poorly recognized condition. Adams said the collaboration with the strength and breadth of Glaxo's commercialization team will help reach U.S. physicians who treat the condition.
As a result of the additional expected Testim sales, Auxilium raised its full-year revenue guidance by $10 million, now seeing $293 million to $315 million, roughly in line with Street estimates.
Auxilium now expects a loss of $5 million to $10 million for 2012, compared with its previously expected loss of $5 million to $15 million.
Under the agreement, Auxilium has given Glaxo, a British drug firm, the exclusive right to co-promote Testim in the U.S. through September 2015. Glaxo will be compensated for net sales exceeding a baseline set by the two companies, and may receive additional tail payments following the term of the agreement.
The GlaxoSmithKline team expects to begin promoting Testin to doctors early in the third quarter of this year, while Auxilium will remain responsible for drug manufacturing, supply and regulatory activities.
U.S. sales of testosterone therapies have grown to more than $1.6 billion a year, the companies said, including $1.4 billion in sales of testosterone gels.
Auxilium's shares closed at $17.63 on Friday. The stock is down 12% so far this year. Glaxo's American depositary shares closed at $44.18 on Friday and are down 3.2% so far this year. Both were inactive premarket.
-By Kristin Jones; Dow Jones Newswires; 212-416-2208; kristin.jones@dowjones.com
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