Research And Development Agreements

6 Months Ended

Jun. 30, 2011

Research And Development Agreements

Research And Development Agreements

Note 17 - Research and Development Agreements:

In June 2008, through an exclusive licensing agreement with MonoSol Rx ("MonoSol"), Strativa acquired the U.S. commercialization rights to MonoSol's oral soluble film formulation of ondansetron (Zuplenz®).  In December 2009, the parties amended the agreement to modify the terms of future milestone and royalty payments and concurrently entered into another agreement noted below.  The amendment provided for a reduction in future payments.  On July 2, 2010, the FDA approved Zuplenz®.  We paid MonoSol a total of $6,000 thousand as a result of the FDA approval.  Refer to Note 18 – "Restructuring Costs" for details of intangible asset impairment charges in the three months and six months ended June 30, 2011.

In December 2009, concurrently with the amendment of the Zuplenz® agreement noted above, Strativa entered into another exclusive licensing agreement with MonoSol to acquire the U.S. commercialization rights to MonoSol's oral soluble film formulation of up to three potential new products.  Under this agreement, we made a one-time payment of $6,500 thousand, which was charged to research and development expense.  On May 24, 2010, Strativa and MonoSol reached a mutual decision to discontinue the development of the first product under the agreement.  On June 22, 2010, MonoSol delivered certain development results for the second product, triggering a 90-day option period during which Strativa could have elected to have MonoSol continue development of the second product.  Strativa did not elect to continue development of the second product.  During the two-year period ending December 9, 2011, Strativa had the right to elect to have Monosol develop a third product, however Strativa has declined to exercise such right.

In second quarter of 2010, Par acquired the rights and obligations of a collaboration arrangement for a product currently in development for an up-front payment of $5,500 thousand that was expensed as research and development.  The arrangement provides for additional milestone payments of up to $5,500 thousand based upon certain development activities, FDA approval, certain conditions and sales.  The first two $500 thousand milestones were achieved during the second and fourth quarter of 2010, and the resultant payments were expensed as research and development.  Par will participate in a profit sharing arrangement with its third party collaboration partner based on any future sales.