Santhera Pharmaceuticals Holding AG agreed to license worldwide rights, excluding the U.S. and Canada, for its eye disorder treatment Raxone to Chiesi Farmaceutici SpA for an up-front cash payment of CHF 50 million.

Raxone is approved by the European Medicines Agency to treat Leber's hereditary optic neuropathy, or LHON, an inherited disease characterized by vision loss and blindness. The drug restores cellular energy levels in the retinal cells and promotes vision recovery.

Santhera is eligible to receive another CHF 55 million from Chiesi in sales milestone payments. Chiesi will have all rights for the development, commercialization and distribution of Raxone outside the U.S. and Canada.

Under the agreement, Chiesi has the option to completely acquire Santhera's Raxone business, subject to the completion of certain reimbursement and post-regulatory commitments by Santhera.

Santhera expects to close the transaction in the third quarter of 2019. The Swiss biotechnology company will continue to provide medical, technical, logistical and scientific support regarding market authorization and market access undertakings of Raxone for several months.

The company has also agreed to continue commercializing the drug for LHON in France until the ongoing pricing and reimbursement negotiations are finalized and will complete the post-approval activities.

Santhera will also be responsible to complete the ongoing post authorization measures, expected by 2021, in conjunction with the centralized European marketing authorization granted in 2015.

After the transaction, Santhera will focus its resources on advancing its late-stage clinical pipeline of products for the treatment of neuromuscular and pulmonary diseases.