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VIVUS (NASDAQ: VVUS ) has closed a commercial arrangement for one of its most important products. The company announced in an SEC filing that it signed a manufacturing and supply agreement for its erectile dysfunction drug avanafil with Sanofi's (NYSE: SNY ) Sanofi Winthrop subsidiary.
The latter company will be the exclusive maker and supplier of the treatment in the U.S. and on a semi-exclusive basis in Europe, Latin America, and other regions. The deal is retroactive to this past September 1 and will be in force for five years after the date of the first commercial sale, auto-renewing for additional two-year periods unless canceled by either company. It mandates VIVUS to buy a minimum number of avanafil tablets starting in 2015. That number was not specified, nor were the financial terms of the agreement between the two.
The market for erectile dysfunction totaled around $4.3 billion in 2012, according to a study published in October by Transparency Market Research. In the near future, however, that figure is expected to decline at a compound annual growth rate of 4.5% to land at roughly $3.4 billion in 2019.