Salix acquires rights to diarrhea treatment

Salix Pharmaceuticals Ltd. said Wednesday it acquired rights to a drug candidate aimed at treating chronic diarrhea in HIV patients.

Salix acquired the rights for the drug, crofelemer, from Napo Pharmaceuticals Inc. for a $5 million license fee and future milestone payments based on regulatory approvals and sales. The drug currently is in late-stage clinical testing.

Salix Chief Executive Carolyn Logan said in a statement from the company crofelemer is "a strategic addition to our expanding portfolio of gastrointestinal products."

Logan said as many as 30 percent of people in the United States living with HIV, the virus that causes AIDS, are affected by chronic diarrhea, which contributes to increased mortality.

The company expects to complete its late-stage study for crofelemer and submit an application to the U.S. Food and Drug Administration for approval to treat HIV patients during the first half of 2010. Logan said that if crofelemer proves successful, Salix may consider additional uses in "the broader diarrhea market."

Salix shares fell 40 cents, or 4.4 percent, to $8.61 in Wednesday's trading. The stock has ranged from $5.07 to $10.47 over the past year.