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Omeclamox®-Pak, Ethyol®, Totect® and Methotrexate®
12 Months Ended
Dec. 31, 2017
Business Combinations [Abstract]  
Omeclamox®-Pak, Ethyol®, Totect® and Methotrexate®
Omeclamox®-Pak, Ethyol®, Totect® and Methotrexate® 
Omeclamox-Pak
During November 2015, Cumberland entered into an agreement with Gastoenterlogics Inc. ("GEL") to assume the remaining commercial rights to Omeclamox-Pak for the United States. Omeclamox-Pak is a branded prescription product that combines omeprazole, amoxicillin and clarithromycin for the treatment of Helicobacter pylori (H. pylori) infection and duodenal ulcer disease. The Company had previously signed an agreement with Pernix Therapeutics ("Pernix") to jointly commercialize the product in the U.S. in October 2013. As part of the GEL Agreement, Cumberland and Pernix terminated their arrangements. The Company continued to market and sell Omeclamox-Pak and also became responsible for the supply chain, national accounts and all sales promotion as part of the GEL agreement.
The agreement with GEL had a term through November 2035, with no additional upfront payments required. Royalty payments ranging from 15% to 20% based on tiered levels of gross profits are paid by Cumberland to GEL.
Under the Company's previous agreement with Pernix to distribute and promote Omeclamox-Pak it paid an upfront payment of $4.0 million to Pernix in October 2013. The agreement called for additional milestones at the first and second anniversary dates of the execution of the agreement totaling $4.0 million in the aggregate. Cumberland was not required to make either milestone payment to Pernix as all the criteria for these payments were not met, including Pernix's co-promotion obligations. Royalty payments ranging from 15% to 20% based on tiered levels of gross profits were paid by Cumberland to Pernix.
The $4.0 million upfront payment that the Company paid in October 2013 was included in product and license rights and is being amortized over the remaining expected useful life of the acquired asset, currently the life of the original Pernix agreement, June 2032. The agreement with GEL has a term of November 2035 and the Company has decided to maintain the original useful life for amortization purposes. Omeclamox-Pak contributed $1.8 million, $2.5 million, and $3.0 million in net revenues during 2017, 2016, and 2015, respectively.
Ethyol
During May 2016, the Company announced an agreement with Clinigen Group Plc ("Clinigen") in which Cumberland acquired the exclusive rights to commercialize Ethyol in the United States. Ethyol is a FDA approved cytoprotective drug indicated as an adjuvant therapy to reduce the incidence of xerostomia (dry mouth) as a side-effect in patients undergoing post-operative radiation treatment for head and neck cancer. It also reduces the cumulative renal toxicity associated with the repeated administration of cisplatin in patients with advanced ovarian cancer.
Under the terms of the agreement, Cumberland is responsible for all marketing, promotion, and distribution of the product in the United States. There were no upfront payments required under the agreement. Royalty payments ranging from 30% to 50% based on tiered levels of net sales are paid by Cumberland to Clinigen. The Company began generating revenue from the sale of Ethyol during the third quarter of 2016. Ethyol contributed $10.8 million and $0.8 million in net revenues during 2017 and 2016, respectively.
Methotrexate
In November 2016, the Company announced an Agreement to acquire the exclusive U.S. rights to Nordic Group B.V.’s ("Nordic") injectable methotrexate product line. The products are designed for the treatment of active rheumatoid arthritis, juvenile idiopathic arthritis, severe psoriatic arthritis, and severe disabling psoriasis. The product line is approved for patient use in various European countries. Cumberland will register and commercialize the methotrexate products in the United States.
Under the terms of the Agreement, Cumberland will be responsible for the products’ FDA submission and registration. The regulatory submission will be based on the dossier provided by Nordic. Following registration, Cumberland will be responsible for product launch and commercialization, including all marketing, promotion, and distribution of the products in the U.S. As consideration for the license, Cumberland paid a deposit of $100,000 and recorded a liability of $900,000 provided through 180,000 unvested restricted shares of Cumberland stock, valued on November 15, 2016, that will fully vest upon the FDA approval of the first Nordic product. Cumberland will also provide Nordic a series of payments tied to the products’ FDA approval, launch and achievement of certain sales milestones. Nordic will be responsible for manufacturing and supply of the products. The 180,000 shares of unvested restricted Cumberland stock was reflected in other current liabilities in the consolidated balance sheet and were valued at $1.3 million and $1.0 million at December 31, 2017 and 2016, respectively.
Totect
During January 2017, the Company announced an agreement with Clinigen in which Cumberland acquired the exclusive rights to commercialize Totect in the United States. Totect is an FDA-approved hospital based emergency oncology intervention drug, indicated to treat the toxic effects of anthracycline chemotherapy. It treats anthracycline extravasation that occurs when the injected medication escapes from the blood vessels and circulates into surrounding tissues in the body, causing severe damage and serious complications. Totect can limit such damage without the need for additional surgeries or procedures and enables patients to continue their essential anti-cancer treatment.
The Company launched Totect during a national shortage of dexrazoxane, resulting in strong initial demand for the product. It's our second oncology support product and the second product licensed to us through our Strategic Alliance with Clinigen.
Under the terms of the agreement, Cumberland is responsible for all marketing, promotion, and distribution of the product in the United States. There are no upfront payments required under the agreement. Royalty payments ranging from 30% to 50% based on tiered levels of net sales are paid by Cumberland to Clinigen. The Company began generating revenue from the sale of Totect during the third quarter of 2017. Totect contributed approximately $4.0 million in net revenue during 2017. Totect revenue includes $0.3 million in Cardioxane net revenue for 2017.