NPS Pharmaceuticals, Inc. ( NPSP - Snapshot Report ) and Takeda Pharmaceutical Company Limited ( TKPYY ) recently amended their deal regarding a couple of drugs. Following the amended deal, NPS Pharma bought back the entire global rights to short bowel syndrome therapy teduglutide and recombinant human parathyroid hormone 1-84 (PTH 1-84) from Takeda.

While teduglutide is marketed in the US under the trade name Gattex, the drug is approved in Europe under the trade name Revestive. The drug was approved in the EU and the US in August and December last year, respectively. PTH 1-84 was approved in the EU in Apr 2006 for treating women suffering from post-menopausal osteoporosis.

The drug is marketed in the EU under the trade name Preotact. PTH 1-84 is being developed in the US for treating adults suffering from hypoparathyroidism. The proposed trade name for the drug in the US is Natpara. NPS Pharma intends to seek US approval of PTH 1-84 for the hypoparathyroidism indication during the course of the year.

NPS Pharma licensed the commercial rights to Preotact and Revestive to Nycomed (now a wholly-owned subsidiary of Takeda) in 2004 and 2007, respectively, for ex- North American markets.

Under the terms of the amended deal, Takeda will assign its assets pertaining to the 2 drugs to NPS Pharma. Moreover, Takeda is entitled to receive common stock of NPS Pharma worth $50 million.

Furthermore, NPS Pharma will have to make a milestone payment to Takeda in the first calendar year, in which the combined global net sales of the drugs will cross the $750 million mark. NPS Pharma can make the payment either in cash ($30 million) or stock.

While NPS Pharma carries a Zacks Rank #3 (Hold), Takeda Pharma holds a Zacks Rank #4 (Sell). Favorably placed stocks in the pharma sector include Lannett Company, Inc. ( LCI - Snapshot Report ) and WuXi PharmaTech (Cayman) Inc. ( WX - Snapshot Report ) . Both the stocks carry a Zacks Rank #1 (Strong Buy).