GlaxoSmithKline plc (GSK) has reached an agreement with XenoPort Inc., to terminate their collaboration concerning Horizant (gabapentin enacarbil) extended-release tablets, for which GSK had commercialization rights and certain development rights in the United States.

Under the termination and transition agreement, GSK is returning Horizant rights to XenoPort and providing certain assistance during the transition period ending April 30, 2013, upon mutually agreed terms. The decision to return the asset is aligned with GSK’s ongoing strategy to streamline its portfolio to focus on core franchise opportunities. The agreement also resolves all litigation between the parties. XenoPort acknowledges that GSK fulfilled its contractual obligations on the development, manufacturing and commercialization of Horizant.

The company recorded a non-core non-cash intangible asset write-off for the third quarter of 2012 of £103 million pre-tax, and no further one-off charges related to Horizant are expected. 

During the transition period, GSK will continue to exclusively commercialize, promote, manufacture and distribute Horizant. GSK has also agreed to purchase $20 million of common stock in XenoPort at a 12.5% premium to the 10-day average stock price prior to October 31st. In addition, during a six-month period after the effective date of the agreement, XenoPort has the option whereby GSK would purchase an additional $20 million in equity at a 12.5% premium of the 10-day average stock price prior to the day XenoPort notifies GSK of its intent to elect the option.

Horizant will continue to be available to patients.

Date: November 8, 2012
Source: GlaxoSmithKline plc