Allergan Expands Urologics Portfolio - Analyst Blog

Allergan, Inc. (AGN) recently entered into an agreement with Serenity Pharmaceuticals, for the development and commercialization of Ser-120, which is being studied for the treatment of nocturia. Nocturia, which is characterized by frequent urination during the night, is a common urological disorder observed in adults. 

Allergan will make an upfront payment of $43 million to Serenity for exclusive worldwide rights for the development, manufacture and commercialization of Ser-120. The deal covers all potential indications excluding pediatric bedwetting. 

In addition to the upfront payment, Serenity is eligible to receive up to $122 million in development and regulatory milestone payments, sales milestones and royalty payments on worldwide sales. 

The deal is in-line with Allergan’s aim to establish itself in the genitourinary (GU) market ahead of the potential launch of Botox for the treatment of idiopathic and neurogenic overactive bladder (OAB) and benign prostate hyperplasia (BPH). 

Botox, which is approved in 80 countries for up to 21 indications, is currently being studied for several new indications including chronic migraine, upper limb spasticity, lower limb spasticity, neurogenic overactive bladder, idiopathic overactive bladder and benign prostate hyperplasia.
 
Botox is currently in phase III studies for both the neurogenic overactive bladder and idiopathic overactive bladder indications. 

The agreement with Serenity should help expand Allergan’s urology portfolio which currently consists of Sanctura XR, a once-daily anticholinergic that is approved for the treatment of overactive bladder (OAB).
 
Allergan’s urologics portfolio delivered sales of $65.6 million in 2009. Ser-120 is currently in phase III studies and the successful development and commercialization of the candidate would help boost Allergan’s urologic portfolio’s performance. 

We currently have a Neutral recommendation on Allergan. We believe that the company’s presence across different segments and geographies will help maintain decent growth going forward. Although growth slowed down in 2009, we believe the company will be back to its historical mid-to-high teens earnings growth trajectory from 2011.
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