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NEW YORK, May 12 (Reuters) - Forest Laboratories Inc FRX.N has ended its agreement with Daiichi Sankyo Co Ltd (4568.T) to co-promote Daiichi’s blood-pressure drug Azor, as Forest shifts resources to support other products, the companies said on Monday.
Forest, a mid-sized U.S. drug maker, will record a one-time charge of $44.1 million, which includes a $26.6 million payment to Japan’s Daiichi and $17.5 million related to the unamortized portion of an initial payment.
Azor, which combines ingredients in Pfizer Inc’s (PFE.N) Norvasc and Daiichi’s Benicar, had won U.S. approval in September. The companies had earlier struck a deal to co-promote Benicar.
Although the Benicar deal remains in force, Forest will no longer actively promote it. Ending promotion of Benicar and Azor will effectively make available to Forest a 500-person salesforce to support its other medicines, Forest said.
“Our decision to reallocate resources to our currently marketed products causes us to forego the opportunity to continue to participate in the promotion of Daiichi Sankyo’s excellent product Azor,” Forest Chief Executive Howard Solomon said in a statement.
Forest shares slumped last month when the company offered a disappointing 2008 profit forecast including a sharp expected rise in spending.
The company is trying to build up its product line before its top two products — the Lexapro anti-depressant and Namenda Alzheimer’s treatment — lose U.S. patent protection early next decade.
Daiichi will take sole responsibility for promoting Azor beginning in July. The company has been adding capacity to its cardiovascular sales force ahead of the potential launch of prasugrel, a blood-clot treatment under U.S. regulatory review.
Daiichi is partnered with Eli Lilly and Co (LLY.N) on prasugrel, which is expected to be a huge seller should it win approval.
Forest shares rose 14 cents to $34.04 in morning trading on the New York Stock Exchange. Daiichi shares earlier closed up 0.5 percent in Tokyo. (Reporting by Lewis Krauskopf, editing by Maureen Bavdek)