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Swiss drugmaker Novartis is calling a drug back home in a partnership deal valued at nearly half a billion dollars.
The company is buying back the rights to a schizophrenia pill that it sold to another company years ago because Novartis [NVS
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] thought it wasn't worth pursuing.
The drug firm will pay tiny Vanda Pharmaceuticals $200 million cash up front, another $265 million over time and royalties. Novartis also will pick up certain expenses.
Vanda [VNDA
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] has risen from the ashes. It was a dollar stock several months ago, but has climbed to more than $11 since the FDA surprisingly approved the one-a-day schizophrenia pill known as Fanapt. It's share leaped in late trading Monday. Click here for after-the-bell Novartis and Vanda quotes.
The company is also testing a longer-acting injectable version of it.
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When Novartis unloaded the drug, Vanda was privately-held and the price wasn't made public.
In a CNBC interview, coincidentally on the very morning the FDA gave the OK on Fanapt, Novartis CEO Dr. Daniel Vasella said, "Based on the data we had we made a decision, which we thought was rational. You also have to take into consideration that we always have several opportunities. So, we have to make tradeoffs between different drugs we want to develop."
Fanapt is expected to come to market soon. Vanda will hold a conference call Tuesday morning.
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