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Killing Bacteria With the Help of a Friend

By Brian Orelli, PhD - Updated Apr 6, 2017 at 10:32PM

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Optimer enlists the services of Cubist.

What's the best way for a drugmaker launching its first drug to get out of the gate quickly? Rent a sales force from a buddy in the industry.

Optimer Pharmaceuticals (Nasdaq: OPTR) announced today that it had signed up Cubist Pharmaceuticals (Nasdaq: CBST) as a marketing partner for at least the next two years. Optimer will pay Cubist $15 million per year to market its antibiotic Dificid. There are also incentives in the form of $17.5 million in bonuses for reaching certain sales milestones and a portion of gross profits over certain levels.

Cubist sells an antibiotic called Cubicin, but it treats a different type of bacterial infections, so the two drugs won't compete with each other. It's a smart move by both companies. Optimer gets better coverage of doctors and Cubist gets to make better use of its sales force. Which company will ultimately benefit more isn't clear since the level of sales required to reach the incentives weren't disclosed.

Dificid went in front of a Food and Drug Administration advisory panel meeting yesterday. As expected, the panel of experts was wildly supportive of approving the drug. They argued a little more about whether the data suggesting that Dificid prevents recurrences of the infection is clinically meaningful, splitting six to six with one abstention.

The latter is important because the recurrence data is one of the main benefits of using Dificid over ViroPharma's (Nasdaq: VPHM) Vancocin. The panel only has an advisory role; the ultimate decision of whether the data makes it onto the label will be determined by the FDA.

Whether it's on the label or not, it seems extremely likely that Dificid will be approved. The deal today should help Optimer ramp up sales quicker than it could on its own, but the label will likely make a big difference as well.

The advisory panel was supposed to remove a lot of uncertainty in the stock. Unfortunately it looks like investors are in for a rocky ride up through the PDUFA decision date on May 30.

Follow Optimer as it tries to gain FDA approval of Dificid. Click here to add it to My Watchlist, which will help you keep track of all our Foolish analysis on Optimer.

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