Palatin Technologies (PTN), which is looking to take the throne from Addyi as the primary drug treatment for low sex drive in women, has hired an investment bank to explore a sale or licensing deal, according to a source familiar with the matter.
Cranbury, N.J.-based Palatin retained Greenhill & Co after receiving a number of offers from interested companies, the source said, cautioning that there is no guarantee the review will result in a deal.
The source requested not to be named because the process is still private. Palatin did not immediately respond to requests for comment.
Palatin’s review follows a disappointing debut for Addyi, dubbed “the female Viagra.” Drugs that treat low sexual desire in women are said to be a $2 billion worldwide market.
Addyi has been owned by Valeant Pharmaceuticals (VRX) since last year, when the pharmaceutical company bought Sprout Pharmaceuticals for around $1 billion.
Despite a flurry of initial excitement surrounding Addyi, it has faced a number of challenges. The drug’s restrictive requirements – alcohol abstinence and daily consumption – have led to complaints it is burdensome. The drug can also affect patients’ blood pressure, requiring it to include safety warnings.
Palatin, meanwhile, says its drug is safe to use with alcohol and is not expected to require the same precautionary safety label as Addyi.
Palatin’s primary drug, bremelanotide, is in late stage clinical trials. It received positive data feedback on Nov. 1, putting it on a path to apply for regulatory approval next year.
In August, Palatin issued stock to finance its continued studies of bremelanotide, raising about $9 million. With no drugs currently on the market, it continues to be unprofitable, posting a $13-million loss in the most recent quarter.
Palatin is one of many biotechnology companies that have in recent months opted to finance their next stage of drug research through a sale or a partnership with a larger company, rather than through equity issuance.
The Nasdaq Biotech Index has declined as much as 30 percent in the past year, due to uncertainty about government policies towards drug pricing leading into the election.