Nastech Pharma and Amylin Pharmaceuticals have entered into an agreement to develop a nasal spray formulation of Byetta (exenatide). Preclinical studies of the formulation have been completed in preparation for Phase I studies.

Under terms of the agreement, Nastech will receive milestone payments and royalties on product sales. If feasibility and the program moves forward, milestone payments could reach as much as $89 million in total, based on development, regulatory and commercialization goals. Royalty rates will rise with product success.

Under the agreement, the two companies will develop the nasal spray formulation using Nastech’s nasal delivery technology, and Amylin will reimburse Nastech for any development activities. Amylin has overall responsibility for the development program including clinical, non-clinical and regulatory activities Nastech’s efforts will focus on drug delivery and chemistry, manufacturing and controls (CMC) activities. If a supply agreement is reached between the companies, Nastech may supply commercial product to Amylin and its collaboration partner, Eli Lilly and Co.

“Amylin is a leader in developing innovative therapeutics and we are very excited to work with them,” stated Steven C. Quay, M.D., Ph.D., chairman, president and chief executive officer of Nastech. “This collaboration validates an important aspect of Nastech’s business strategy, which is to conduct feasibility studies with biopharmaceutical companies and later convert them into development and commercial manufacturing collaborations. We will continue to work with our collaboration partners to provide therapeutics that promote a healthier life.”