RedHill Biopharma regains worldwide rights to RHB-106

Although rising as high as 217.10 shekels initially, shares of Israel’s RedHill Biopharma (Nasdaq: RDHL) were down 0.38% at 210.00 shekels by close of trading, after it revealed that it has provided Salix Pharmaceuticals with a notice of termination of their 2014 license agreement and has regained the worldwide exclusive rights to RHB-106, a proprietary encapsulated formulation for bowel preparation, currently under development.

“We are pleased to regain the rights to RHB-106, which aligns well with our expanded gastrointestinal-focused commercial activities in the US, and to pursue its development toward potential US FDA approval,” Dror Ben-Asher, chief executive of RedHill, adding: “The quality of a bowel preparation, defined by its safety, palatability and efficacy, directly impacts the success of a colonoscopy. We believe RHB-106’s novel flavorless solid oral pill formulation holds significant potential advantages over current bowel preparations and could ease patient burden and improve the likelihood of a successful outcome.”

The original transaction terms included an upfront payment of $7 million and $5 million in milestone payments to RedHill. Salix also had agreed to pay RedHill tiered royalties on net sales, ranging from low single-digit up to low double-digits.  Salix subsequently became a subsidiary of Canada’s Bausch Health (NYSE: AHC) in 2015.