SOURCE: Depomed, Inc.

September 28, 2010 06:09 ET

Depomed Announces Receipt of $500,000 Milestone Payment from Covidien Upon First Formulation Entering Clinical Development

MENLO PARK, CA--(Marketwire - September 28, 2010) -

Depomed, Inc. (NASDAQ: DEPO) announced today that it has received another $500,000 milestone payment after the first formulation that is being developed under its worldwide license agreement with Covidien entered clinical development. The collaboration with Covidien focuses on the exclusive development of up to four acetaminophen/opioid analgesic combination products utilizing Depomed's Acuform® gastric retentive drug delivery technology.

"We are pleased that the first product candidate has already advanced into clinical development. This first product candidate could be launched into the market as soon as 2013. Since we retained co-promotion rights of the product to the OB/GYN field, the launch would fit nicely with our expected approval of our menopausal hot flash product Serada in late 2012," said Carl A. Pelzel, Depomed's president and chief executive officer.

Covidien is the largest supplier of controlled pain medications in the United States based on number of prescriptions. The company is expanding the limits of pain therapy by combining proven drugs with innovative delivery systems.

Depomed's Acuform technology is designed to enable extended and controlled release of oral medications in the upper gastrointestinal tract for once- daily administration, improved treatment tolerability and enhanced compliance and efficacy.

Under the license agreement between Depomed and Mallinckrodt Inc., a Covidien company, Depomed received a one-time upfront payment of $4 million, has received $1.5 million in development milestone payments so far, and could receive up to $62.5 million in additional development milestone payments over the next several years. In addition, Covidien will pay Depomed a royalty on sales of products developed under the license agreement. Covidien is responsible for all development other than certain initial formulation work.

About Depomed

Depomed, Inc. is a specialty pharmaceutical company with one product candidate through Phase 3 clinical development, another in Phase 3 clinical development, two approved products on the market and other product candidates in its early stage pipeline. Product candidate DM-1796 has completed Phase 3 clinical development and has been licensed to Abbott Products Inc. A New Drug Application for DM-1796 was accepted by the FDA in the second quarter of 2010. Product candidate Serada® is in Phase 3 clinical development for menopausal hot flashes. GLUMETZA® (metformin hydrochloride extended release tablets) is approved for use in adults with type 2 diabetes and promoted by Santarus, Inc. in the United States. Depomed formulates its products and product candidates with its proven, proprietary Acuform® drug delivery technology, which is designed to improve existing oral medications, allowing for extended, controlled release of medications to the upper gastrointestinal tract. Benefits of Acuform- enhanced pharmaceuticals include the convenience of once-daily administration, improved treatment tolerability and enhanced compliance and efficacy. Additional information about Depomed may be found on its website, http://www.depomed.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995.

The statements that are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties including, but not limited to, those related to our collaboration with Covidien; our research and development efforts, including pre-clinical and clinical testing; regulation by the FDA and other government agencies; the timing of regulatory applications and product launches; and other risks detailed in the company's Securities and Exchange Commission filings, including the company's Annual Report on Form 10-K and most recent Quarterly Report on Form 10-Q. You are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date hereof. The company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

CONTACT:
Sheilah Serradell
Depomed, Inc.
650-462-5900
sserradell@depomed.com

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Source: Depomed, Inc. via Thomson Reuters ONE

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