Bothell firm buys back vitamin gel

Published 12:26 pm Thursday, February 21, 2008

BOTHELL — Nastech Pharmaceutical Co. announced Tuesday Oct. 8 that it has bought back all the sales rights for the company’s lead product, a vitamin B12 nasal gel called Nascobal.

The Bothell-based company paid $8.75 million to Schwarz Pharma AG, which previously held the exclusive U.S. sales and distribution rights to Nascobal.

After developing the synthetic form of B12, Nastech signed a marketing agreement with Schwarz in 1997. In July, the company terminated its agreement, saying Schwarz failed to promote the product sufficiently.

But Schwarz still held the rights to the drug.

Under the acquisition agreement, Nastech already has paid $1.5 million and will provide the rest of the $8.75 million plus interest to Schwarz over the next four years.

In return, Schwarz gives up all rights to the product.

The Nascobal nasal gel can be used by patients who have diseases that make them vulnerable to vitamin B12 deficiency, which can lead to anemia, intestinal problems and nerve damage. More than 90 percent of the B12 given to these patients now is by injection, according to Nastech.

The Food and Drug Administration recently allowed the company to label the drug for use in patients with Crohn’s disease, HIV, AIDS and multiple sclerosis. Up to 175,000 of those with Crohn’s disease, a chronic inflammation of the digestive tract, are candidates for B12 therapy, so Nastech is looking first to expand the drug’s use with them.

“The relaunch of Nascobal into the Crohn’s market is a great opportunity for us to achieve a number of corporate objectives,” said Greg Weaver, Nastech’s chief financial officer.

The company has contracted with Cardinal Health Inc. to market Nascobal through direct-to-consumer advertising and a marketing campaign directed at doctors who deal with Crohn’s disease patients.

Last year, Nastech recorded about $2.5 million in sales of Nascobal. Staff at the Everett Herald completed this report.