Novartis has renegotiated its $293 million deal to commercialize Durect’s Posimir postoperative painkiller, cutting its milestone payments following the failure of a phase 3 trial reported last October.

Durect had received $20 million upfront from Novartis’ Sandoz division in May 2017, and was eligible for up to $43 million for achieving development goals, with up to $230 million to follow if the drug goes on to meet sales targets.

But in the PERSIST trial, Posimir (Saber-bupivacaine) missed its primary endpoint of reducing pain in the first two days after surgery, compared to standard bupivacaine. The deal was amended from the $43 million in milestone payments down to $30 million, to be based on FDA approval. Durect remains eligible for the $230 million in sales-based payments, the company said in a statement.

Posimir’s development has not been easy. Durect hopes their formulation of the nonopioid analgesic will provide continuous local pain relief after surgery, through a biodegradable depot placed within the incision that slowly releases the drug over three days.

But in 2014, the FDA handed down a complete response letter to the then-named Posidur, requesting additional clinical safety studies, two years after missing efficacy endpoints in another late-phase trial.

PERSIST would have its own problems: the FDA recommended a series of protocol amendments, including the addition of bupivacaine as a standard control. Durect enrolled 296 patients who underwent minimally invasive gallbladder removal surgery, and while results trended in Posimir’s favor, they were not statistically significant.

The renegotiation also modified the agreement’s termination provisions, including a right for Durect to leave the deal prior to NDA approval. A new fee was added, should Sandoz decide to terminate the agreement for convenience. Previously, Durect said that with last year’s failure of PERSIST, Sandoz had the right to terminate the agreement with 30 days’ notice.

In addition, the amendment now permits either party to develop or commercialize competing products. Sandoz maintains exclusive rights and responsibility to commercialize Posimir in the U.S. following approval.

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