By Geert De Lombaerde From Nashville Post

New treatment will be company’s biggest seller

Cumberland Pharmaceuticals has signed a definitive agreement to buy an antibiotic treatment for some skin infections and hospital-acquired pneumonia from a much larger publicly traded company.

Cumberland’s deal to take over Vibativ from Theravance Biopharma calls for the local firm to pay its Cayman Islands-based peer $20 million when the transaction closes — that’s expected later this month — as well as another $5 million early next year. Beyond that, Cumberland will pay tiered royalties of up to 20 percent on future U.S. net sales of Vibativ.

Theravance (Ticker: TBPH), which has its main offices in San Francisco, has been marketing Vibativ through partners in the United States as well as Canada, the Middle East and North Africa, Israel, Russia, China and India. But in regulatory filings, company executives said they have struggled to find marketing partners and earlier this year tightened the reins to focus on developing other products. Cumberland Chairman and CEO A.J. Kazimi told thePost the medicine posted sales of about $15 million in 2017 — Cumberland’s top-selling products, Kristalose and Ethyol, each booked sales of about $11 million — and has grown this year.

Kazimi and his team will take on global marketing and distribution responsibilities for Vibativ and look to leverage their sales force — as well as a still undecided number of Theravance salespeople — to take Vibativ sales to another level. Kazimi told the Post he also expects to add some Theravance home office personnel to his team on West End Avenue.

“Our immediate plan for Vibativ is to ensure a smooth transition of the product supply and medical support to current users of the brand,” Kazimi said. “We will then launch our hospital promotion and medical initiatives to help ensure that the product is available to the patients who need it.”

The Cumberland team expect that adding Vibativ will begin boosting their profits immediately. Cumberland last year posted a net loss of $4.1 million on sales of $41.2 million.

Cumberland shares (Ticker: CPIX) closed Monday trading at $5.31, down slightly on the day. Over the past six months, they have fallen almost 20 percent.

For more on this story go to: https://www.nashvillepost.com/business/area-stocks/article/21030799/cumberland-paying-25m-for-antibiotic