Small-cap drug maker Somaxon Pharmaceuticals Inc. (SOMX) surged more than 60 percent on Wednesday, the most intraday since March 18, after the company announced an agreement to co-promote with Procter & Gamble (PG) its insomnia treatment Silenor to thousands of doctors and pharmacies.
According to the co-promotion deal for Silenor, P&G representatives will market the drug to primary-care doctors and pharmacies, while Somaxon will focus on specialists who treat insomnia. Working together, the co.’s will have about 215 sales employees targeting Silenor to 35,000 doctors and 25,000 pharmacies in the U.S.
“We are extremely excited to add Procter & Gamble’s highly regarded and tenured professional sales force to our commercialization effort for Silenor,” said in a statement Richard W. Pascoe, Somaxon’s President and Chief Executive Officer.
Somaxon also granted Procter & Gamble a right of first negotiation to develop and market Silenor as an over-the-counter medication in the U.S. and agreed to pay PG a reduced royalty based on U.S. net sales of Silenor for one year after the expiration of the agreement, which runs through Dec. 31, 2012.
Shares of Somaxon were up $1.33, or 40%, to $4.70 at 12:46 pm ET on Wednesday. SOMX shares have traded between $0.90 and $10.60 over the last 52 weeks. PG is down 19 cents, or 0.32%, to $59.47.