In a move certain to buoy struggling Eli Lilly and Co., federal regulators have approved a new drug for testosterone deficiency that the Indianapolis company recently licensed from a small Australian drug developer.
The Food and Drug Administration approved Axiron, a drug that patients with low testosterone can apply with an underarm applicator. Lilly and its partner, Acrux of West Melbourne, Australia, announced the FDA approval late Tuesday.
The companies estimated that up to 13 million men over 45 years of age in the U.S. may have symptoms associated with low testosterone.
"The addition of Axiron to our product portfolio reinforces Lilly's commitment to provide innovative treatment options for patients," said David Ricks, president of Lilly USA.
Shares of Acrux jumped 8.4 percent in Sydney following the announcement.
Lilly has been struggling to launch new products in recent years from its own laboratories, and face a sharp falloff in revenues over the next five years when many of its blockbuster drugs lose patent protection and face generic competition.
Earlier this year, Lilly bought exclusive worldwide rights to commercialize Axiron.
Lilly gave Acrux receives an upfront payment of $50 million, along with $3 million on the transfer of manufacturing assets. Upon FDA review, Acrux was eligible for another $87 million and up to $195 million in potential commercialization milestones, as well as royalty payments on future global sales if Axiron is successfully commercialized
Abbott Labs has been advertising for weeks for testosterone supplements on the cable channels. The ad is titled "Is it low T.com". Last year there were 2.3 million prescriptions written for testosterone. There are big bucks to be made here and that's all the big pharmas care about.